Exhibit
10.18


 


RETIREMENT PLAN FOR SALARIED EMPLOYEES OF
BLUE RIDGE PAPER

PRODUCTS INC.


 


(as effective May 14,1999)


 

















 


BLUE RIDGE PAPER PRODUCTS INC.


 


SALARIED EMPLOYEES RETIREMENT PLAN


 


Table of Contents


 


	
  ARTICLE 1 –
  INTRODUCTION AND PURPOSE

  	
   

  
	
   

  	
   

  
	
  ARTICLE 2 –
  DEFINITIONS

  	
   

  
	
  2.1

  	
  Accrued Benefit

  	
   

  
	
  2.2

  	
  Actual Earnings

  	
   

  
	
  2.3

  	
  Actuarial Equivalent

  	
   

  
	
  2.4

  	
  Adjusted Earnings

  	
   

  
	
  2.5

  	
  Affiliate

  	
   

  
	
  2.6

  	
  Annuity Starting
  Date

  	
   

  
	
  2.7

  	
  Average Earnings

  	
   

  
	
  2.8

  	
  Beneficiary

  	
   

  
	
  2.9

  	
  Benefit
  Commencement Date

  	
   

  
	
  2.10

  	
  Board or
  Board of Directors

  	
   

  
	
  2.11

  	
  Break in Service

  	
   

  
	
  2.12

  	
  Champion

  	
   

  
	
  2.13

  	
  Champion Plan

  	
   

  
	
  2.14

  	
  Code

  	
   

  
	
  2.15

  	
  Committee

  	
   

  
	
  2.16

  	
  Disability

  	
   

  
	
  2.17

  	
  Earliest
  Retirement Age

  	
   

  
	
  2.18

  	
  Early Retirement Age

  	
   

  
	
  2.19

  	
  Effective Date

  	
   

  
	
  2.20

  	
  Eligibility Service

  	
   

  
	
  2.21

  	
  Eligible Employee

  	
   

  
	
  2.22

  	
  Eligibility Year

  	
   

  
	
  2.23

  	
  Employee

  	
   

  
	
  2.24

  	
  Employer

  	
   

  
	
  2.25

  	
  Employment
  Commencement Date

  	
   

  
	
  2.26

  	
  Entry Date

  	
   

  
	
  2.27

  	
  ERISA

  	
   

  
	
  2.28

  	
  Former Champion
  Employee

  	
   

  
	
  2.29

  	
  Hour of Service

  	
   

  
	
  2.30

  	
  Leave of Absence

  	
   

  
	
  2.31

  	
  Named Fiduciary

  	
   

  
	
  2.32

  	
  Normal Retirement
  Age

  	
   

  
	
  2.33

  	
  Normal
  Retirement Benefit

  	
   

  
	
  2.34

  	
  Normal Retirement
  Date

  	
   

  



 

















 


	
  2.35

  	
  Participant

  	
   

  
	
  2.36

  	
  Plan

  	
   

  
	
  2.37

  	
  Plan Assets

  	
   

  
	
  2.38

  	
  Plan Year

  	
   

  
	
  2.39

  	
  Postponed
  Retirement Benefit

  	
   

  
	
  2.40

  	
  Qualified
  Military Service

  	
   

  
	
  2.41

  	
  Reemployment
  Commencement Date

  	
   

  
	
  2.42

  	
  Salaried Employee

  	
   

  
	
  2.43

  	
  Service

  	
   

  
	
  2.44

  	
  Severance

  	
   

  
	
  2.45

  	
  Social Security
  Benefits

  	
   

  
	
  2.46

  	
  Surviving Spouse

  	
   

  
	
  2.47

  	
  Transferred
  Employee

  	
   

  
	
  2.48

  	
  Vesting Service

  	
   

  
	
  2.49

  	
  Vesting Year

  	
   

  
	
  2.50

  	
  Years of
  Credited Service

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE 3 –
  ELIGIBILITY AND PARTICIPATION

  	
   

  
	
  3.1

  	
  Transferred
  Employees

  	
   

  
	
  3.2

  	
  New Employees

  	
   

  
	
  3.3

  	
  Absences
  and Severances of Less Than Twelve (12) Months

  	
   

  
	
  3.4

  	
  Reemployment
  of Former Participant

  	
   

  
	
   

  	
   

  
	
  ARTICLE 4 –
  ACCRUAL OF RETIREMENT BENEFITS

  	
   

  
	
  4.1

  	
  Normal
  Retirement Benefit

  	
   

  
	
  4.2

  	
  Accrued Benefit

  	
   

  
	
  4.3

  	
  Social
  Security Benefit Increases

  	
   

  
	
  4.4

  	
  Grandfathered
  Benefit for Transferred Employee

  	
   

  
	
  4.5

  	
  No
  Duplication of Benefits Between Plans

  	
   

  
	
  4.6

  	
  Effect
  of Plan Amendments on Computation of Benefits

  	
   

  
	
   

  	
   

  
	
  ARTICLE 5 –
  VESTING

  	
   

  
	
  5.1

  	
  Vesting
  At Normal Retirement Age

  	
   

  
	
  5.2

  	
  Vesting
  in Accrued Benefit Prior to Normal Retirement Age

  	
   

  
	
  5.3

  	
  Forfeiture
  on Account of Death

  	
   

  
	
  5.4

  	
  Vesting
  Upon Termination or Partial Termination of the Plan

  	
   

  
	
  5.5

  	
  Limitation on
  Recourse

  	
   

  
	
  5.6

  	
  Unclaimed Benefits

  	
   

  
	
   

  	
   

  
	
  ARTICLE 6 –
  ENTITLEMENT TO RETIREMENT BENEFITS

  	
   

  
	
  6.1

  	
  Normal Retirement

  	
   

  
	
  6.2

  	
  Early Retirement

  	
   

  
	
  6.3

  	
  Postponed Retirement

  	
   

  
	
  6.4

  	
  Termination of
  Employment

  	
   

  
	
  6.5

  	
  Effect of
  Reemployment

  	
   

  



 

















 


	
  6.6

  	
  Benefit Payments

  	
   

  
	
  6.7

  	
  Recovery
  of Payments Made by Mistake

  	
   

  
	
   

  	
   

  
	
  ARTICLE 7 – FORMS
  AND PAYMENT OF RETIREMENT BENEFITS

  	
   

  
	
  7.1

  	
  Basic
  Form of Participant’s Single Life Annuity

  	
   

  
	
  7.2

  	
  Qualified
  Joint and Survivor Annuity

  	
   

  
	
  7.3

  	
  Optional Forms
  of Benefit

  	
   

  
	
  7.4

  	
  Date of
  Payment and Cash-Out

  	
   

  
	
  7.5

  	
  General Rules

  	
   

  
	
  7.6

  	
  Direct Rollover

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE 8 – DEATH
  BENEFITS

  	
   

  
	
  8.1

  	
  Preretirement
  Survivor Annuity

  	
   

  
	
  8.2

  	
  Optional
  Survivor Benefit After Normal Retirement Age

  	
   

  
	
  8.3

  	
  Post-Retirement
  Death Benefit

  	
   

  
	
   

  	
   

  
	
  ARTICLE 9 – PAYMENT
  EXCEPTIONS

  	
   

  
	
  9.1

  	
  Small Benefit

  	
   

  
	
  9.2

  	
  Transitional Rule

  	
   

  
	
   

  	
   

  
	
  ARTICLE 10 –
  LIMITATIONS ON BENEFITS

  	
   

  
	
  10.1

  	
  Definitions

  	
   

  
	
  10.2

  	
  Limitation on
  Benefits

  	
   

  
	
  10.3

  	
  Limitation
  on Participant Contributions

  	
   

  
	
  10.4

  	
  Limitation
  in Case of Defined Benefit Plan and Defined Contribution Plan for the Same
  Employee For Limitation Years Beginning Prior to January 1,2000

  	
   

  
	
  10.5

  	
  Adjustment
  of Defined Contribution Fraction

  	
   

  
	
   

  	
   

  
	
  ARTICLE 11 –
  RESTRICTIONS ON BENEFITS

  	
   

  
	
   

  	
   

  
	
  ARTICLE 12 – FUNDING

  	
   

  
	
  12.1

  	
  Employer
  Contributions

  	
   

  
	
  12.2

  	
  Return
  of Employer Contributions to the Employer

  	
   

  
	
  12.3

  	
  Application
  of Forfeitures

  	
   

  
	
  12.4

  	
  Funding Policy
  and Method

  	
   

  
	
   

  	
   

  
	
  ARTICLE 13 –
  ADMINISTRATION

  	
   

  
	
  13.1

  	
  Named Fiduciaries

  	
   

  
	
  13.2

  	
  Procedures for
  Delegation

  	
   

  
	
  13.3

  	
  Miscellaneous
  Administration Provisions

  	
   

  
	
  13.4

  	
  Initial Claims
  Procedure

  	
   

  
	
  13.5

  	
  Claim Review
  Procedure

  	
   

  
	
  13.6

  	
  Electronic
  Administration

  	
   

  



 

















 


	
  ARTICLE 14 –
  AMENDMENT AND TERMINATION

  	
   

  
	
  14.1

  	
  Amendment and
  Termination

  	
   

  
	
  14.2

  	
  Allocation
  of Plan Assets Upon Termination of the Plan

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE 15 –
  TOP-HEAVY RULES

  	
   

  
	
  15.1

  	
  Definitions

  	
   

  
	
  15.2

  	
  Minimum benefit

  	
   

  
	
  15.3

  	
  Vesting Requirements

  	
   

  
	
  15.4

  	
  Limitations on
  Benefits

  	
   

  
	
   

  	
   

  
	
  ARTICLE 16 –
  MISCELLANEOUS

  	
   

  
	
  16.1

  	
  Construction

  	
   

  
	
  16.2

  	
  Assignment
  or Alienation of Benefits

  	
   

  
	
  16.3

  	
  Data

  	
   

  
	
  16.4

  	
  Employment
  Relationship

  	
   

  
	
  16.5

  	
  Merger,
  Consolidation, or Transfer of Assets or Liabilities

  	
   

  
	
  16.6

  	
  Incompetency
  or Disability

  	
   

  
	
  16.7

  	
  Annuity Contracts

  	
   

  
	
  16.8

  	
  Governing Law

  	
   

  
	
  16.9

  	
  Severability

  	
   

  
	
   

  	
   

  
	
  APPENDIX ONE

  	
   

  
	
   

  	
   

  
	
  ADDENDUM

  	
   

  
	
   

  	
   

  
	
  EXHIBIT
  A

  	
   

  



 

















 


RETIREMENT
PLAN FOR SALARIED EMPLOYEES OF

BLUE RIDGE PAPER PRODUCTS INC.


 


ARTICLE 1


 


INTRODUCTION AND PURPOSE


 


Blue Ridge Paper Products Inc. (Blue Ridge) purchased the assets of the
Canton System from Champion International Corporation (Champion) on May 14,
1999 and the salaried employees of the Canton System became salaried employees
of Blue Ridge on May 14, 1999. Blue Ridge established the Retirement Plan
for Salaried Employees of Blue Ridge Paper Products Inc. (the “Blue Ridge
Plan”), effective May 14, 1999 which is substantially similar to the
Champion International Corporation Salaried Retirement Plan #001 (the “Champion
Plan”) in which the Canton System salaried employees were participants prior to
May 14, 1999. It is the intent of Blue Ridge to provide a total pension
benefit for each employee of the Canton System who became a salaried employee
of Blue Ridge on May 14, 1999 that will be no less than the pension
benefit that would have been received if he had remained an employee of
Champion. All service and earnings with Champion together with service and
earnings with Blue Ridge will be acknowledged in determining the pension
benefit under the Blue Ridge Plan. Such pension benefit so determined will be
offset by the pension benefit earned under the Champion Plan as of May 13,
1999. An addendum to the Blue Ridge Plan reflects the Provisions of the
Champion Plan that are pertinent to the determination of the total pension
benefit for former salaried employees of Champion, who were former employees of
St. Regis Corporation on or after November 20, 1984 and prior to its
merger into the Champion Plan and Hoerner Waldorf Corporation on
February 23, 1977, who became salaried employees of Blue Ridge on
May 14, 1999.


 


Blue Ridge Paper Products Inc. has adopted this Plan in order to
provide retirement income for the benefit of its eligible Salaried Employees
and their Beneficiaries, but limited to those who qualify in accordance with
the terms and conditions of the Plan as set forth herein.


 


Except as otherwise provided by Sections 12.2, 14.2 and 16.2 and by
law, the assets of the Plan shall be held for the exclusive purpose of
providing benefits to Participant and their Beneficiaries and defraying
reasonable expenses of administering the Plan and it shall be impossible for
any part of the assets or income of the Plan to be used, or diverted for
purposes other than such exclusive purposes.


 


This Plan is in compliance with the Uniformed Service Employment and
Reemployment Rights Act of 1994, the Retirement Protection Act of 1994, the
Small Business Job Protection Act of 1996, and the Taxpayer Relief Act of 1997.


 


Blue Ridge Paper Products Inc. intends that this Plan, together with
the Trust Agreement, shall meet all the pertinent requirements for
qualification under the Internal Revenue Code of 1986, as amended, and any
other requirements under the Employee Retirement Income Security Act of 1974,
as amended, and the Plan and Trust Agreement shall be interpreted, wherever
possible, to comply with the terms of said Code and Act and all formal
regulations and rulings pertinent to the Plan and Trust issued thereunder.


 


1

















 


ARTICLE 2


 


DEFINITIONS


 


As used in the Plan, the following terms, when capitalized, shall have
the following meanings, except when otherwise indicated by the context:


 


2.1                                 “Accrued Benefit” means the amount
determined under Section 4.2.


 


2.2                                 (a)                                  “Actual Earnings”, with respect to a
Participant for a Plan Year, means the following, subject to (b), (c), (d) and
(e) below:


 


(1)                                  the total remuneration paid to such
Participant, as an Employee, by the Employer during such Plan Year;


 


(2)                                  payments made by the Employer to such
Participant, during such Plan Year, of compensation from the Employer which was
deferred from prior Plan Years; and


 


(3)                                  payments made by the Employer to such
Participant, during such Plan Year under the Performance Incentive Plan and the
Sales Incentive Plan;


 


(4)                                  amounts that would have been included in (1)
above but for:


 


(A)                              an earnings deferral election that is made
pursuant to Section 401(k) of the Code; or


 


(B)                                an election that is made pursuant to
Section 125 of the Code.


 


(b)                                 The following are excluded from Actual
Earnings:


 


(1)                                  expenses and reimbursements of all types;


 


(2)                                  Employer contributions to the Plan and other
benefit plans of the Employer; and


 


(3)                                  any other special or extraordinary
compensation as decided by the Board. 
If such special or extraordinary compensation is excluded or included by
the Board the Plan will be amended to reflect such exclusion or inclusion.


 


(c)                                  For any Plan Year commencing after
December 31, 1998 and before January 1, 1994 for any Transferred
Employee, Actual Earnings shall not exceed $200,000, adjusted for changes in
the cost of living is provided in section 414(d) of the Code, for the
purpose of calculating a Participant’s Accrued Benefit (including the right to
any optional benefits it provided under the Plan); provided however, the
Accrued Benefit determined in accordance with this provision shall not be less
than the Accrued


 


2

















 


Benefit
determined on February 9, 1989 without regard to this provision; and
provided further, this limitation shall be inapplicable to the extent provided
in Internal Revenue Service Notice 88-131 (or other Internal Revenue Service
pronouncements). Notwithstanding the preceding sentence, the Accrued Benefit of
any Participant who is a highly compensated employee, within the meaning of
section 414(q) of the Code, shall be reduced to the extent a benefit has
accrued with respect to Actual Earnings in excess of $200,000 during the 1989
Plan Year before February 9, 1989.


 


(d)                                 For Plan Years commencing after
December 31, 1993, Actual Earnings shall not exceed $150,000, adjusted for
changes in the cost of living as provided in section 401(a)(17)(B) of the
Code, for the purpose of calculating a Participant’s Accrued Benefit (including
the right to any optional benefit under the Plan); provided however, with
respect to a Participant whose Accrued Benefit on or after January 1, 1994
is based on Actual Earnings for any Plan Year beginning prior to
January 1, 1994 that is in excess of the adjusted $150,000 limitation, his
Accrued Benefit determined in accordance with this provision shall not be less
than the greater of:


 


(1)                                  his Accrued Benefit determined as of
December 31, 1993;


 


(2)                                  his Accrued Benefit determined by applying
the adjusted $150,000 limitation to all Plan Years taken into account for
benefit accrual purposes; or


 


(3)                                  the sum of


 


(A)                              his Accrued Benefit determined as of
December 31, 1993; and


 


(B)                                his Accrued Benefit determined by applying
the adjusted 150,000 limitation only to Plan Years beginning on and after
January 1, 1994 taken into account for benefit accrual purposes.


 


(e)                                  For Plan Years beginning prior to
January 1, 1997, in determining the Actual Earnings of a Transferred
Employee for purposes of (c) and (d) above, the rules of Code
section 414(q)(6) shall apply, except in applying such rules, the term
“family” shall include only the Participant’s Spouse and lineal descendants of
the Participant who have not attained age nineteen (19) before the close of the
Plan Year. If, as a result of these family aggregation rules, the adjusted
$150,000 or $200,000 limitation, as applicable, is exceeded, then the
limitation shall be prorated among the affected individuals in proportion to
each such individual’s Actual Earnings prior to the application of these
limitations.


 


(f)                                    Actual Earnings for Transferred Employees and
for Former Champion Employees for the period prior to May 14, 1999 shall
be as reflected above with the exceptions set forth in the attached Addendum to
the Plan (Actual Earnings).


 


2.3                                 “Actuarial Equivalent” means an
alternative benefit or payment which has a one-sum value equivalent to the
one-sum value of the benefit or payment which it replaces, computed in
accordance with Appendix One to the Plan. The Actuarial Equivalent lump sum
under the cash-out 


 


3

















 


rules of Sections 7.4(d) and 8.1(e) shall be based on the Unisex 1983
Group Annuity Mortality Table and an interest rate equal to the annual rate of
interest on thirty (30) year Treasury securities published by the Board of
Governors for the Federal Reserve System for the Lookback Month. The Lookback
Month shall be the November of the calendar year preceding the benefit
determination date.


 


2.4                               “Adjusted
Earnings” means:


 


(a)                                  With respect to any
Participant who has any period of active employment which does not include a
full Plan Year, and who is not covered by the eligibility requirements of (b)
(c) of this Section 2.4, the Actual Earnings which the Participant would
have been paid for such Plan Year if he had been a full-time Employee for all
of such Plan Year; or


 


(b)                                 With respect to any
Participant who retires from Disability status, for any Plan Year in which he
receives long-term disability payments under the Long Term Disability Benefits
Plan of Blue Ridge Paper Products Inc., an amount equal to his Actual Earnings,
or Adjusted Earnings where applicable, for the Plan Year in which he incurred
the Disability; or


 


(c)                                  Adjusted Earnings for
Transferred Employees and for Former Champion Employees for the period prior to
May 14, 1999 shall be as reflected above with the exceptions as set forth
in the attached Addendum to the Plan.


 


2.5                               “Affiliate”
means each of the following for such period of time as is applicable under
Section 414 of the Code:


 


(a)                                  a corporation which,
together with the Employer, is a member of a controlled group of corporations
within the meaning of Section 414(b) of the Code (as modified by
Section 415(h) thereof for the purposes of Article 10) and the
applicable regulations thereunder;


 


(b)                                 a trade or business
(whether or not incorporated) with which the Employer is under common control
within the meaning of Section 414(c) of the Code (as modified by
Section 415(h) thereof for the purposes of Article 10) and the
applicable regulations thereunder;


 


(c)                                  an organization
which, together with the Employer, is a member of an affiliated service group
(as defined in Section 414(m) of the Code); and


 


(d)                                 any other entity required to be aggregated
with the Employer under Section 414(o) of the Code.


 


2.6                        “Annuity
Starting Date” means the first day of the first period for which a benefit
is payable as an annuity, or in the case of a benefit not payable as an
annuity, the first day on which all events have occurred which entitle the
Participant to such benefit.


 


2.7                        (a)                                  “Average
Earnings” as of any particular time (e.g., attainment of Normal


 


4

















 


Retirement
Age, retirement, termination of salaried employment) with respect to a
Participant, means the greater of:


 


(1)                                  The average of his Actual Earnings, or
Adjusted Earnings where applicable, for the highest five (5) consecutive Plan
Years within the period of nine (9) consecutive Plan Years ending with the Plan
Year prior to the Plan Year that includes such particular time; or


 


(2)                                  The average of his Actual Earnings, or
Adjusted Earnings where applicable, for the five (5) consecutive Plan Years
ending with the Plan Year that includes such particular time; however, if the
final period of employment is not a complete Plan Year, then, notwithstanding
the provisions of Section 2.4 (a), Actual Earnings will be imputed to the
Participant as if he had been a full-time Employee for all of such Plan Year in
accordance with the following:


 


(A)                              The Actual Earnings for that Plan Year to
such particular time; plus,


 


(B)                                The earnings from such particular time to the
end of the final Plan Year which are earnings equal to the pro-rata portion of
his Actual Earnings, or Adjusted Earnings where applicable, for the same period
of time in the fifth preceding Plan Year.


 


(b)                                 The Average Earnings of a Participant who
retires from Disability status shall not be less than his Average Earnings as
of the date of his Disability.


 


(c)                                  If a Participant received Actual Earnings for
fewer than five (5) consecutive Plan Years, then his Average Earnings shall be
the average of his Actual Earnings, or Adjusted Earnings where applicable, for
the Plan Years in which he received Actual Earnings; however, if the final
period of employment is not a complete Plan Year, then notwithstanding the
provisions of Section 2.4(a), Actual Earnings will be imputed to the
Participant as if he had been a full-time Employee for all of such Plan Year in
accordance with the following:


 


(1)                                  The Actual Earnings for that Plan Year to
such particular time; plus,


 


(2)                                  The earnings from such particular time to the
end of the final Plan Year which are earnings equal to the pro-rata portion of
his Actual Earnings, or Adjusted Earnings where applicable, for the same period
of time in the first Plan Year of participation.


 


(d)                                 Notwithstanding the foregoing, the Average
Earnings of a Participant at any particular time shall be the greater of his
Average Earnings as determined above, or the average of his Actual Earnings, or
Adjusted Earnings where applicable, for the Plan Years referenced in (a) and
(b) above but determined by taking into account any bonuses earned in each such
Plan Year rather than any bonuses paid in each such Plan Year.


 


5

















 


(e)                                  “Average Earnings” for Transferred Employees
and Former Champion Employees for the period prior to May 14, 1999 shall
be as reflected above with the exceptions set forth in the attached Addendum to
the Plan (Average Earnings).


 


2.8                                 “Beneficiary” means the person or
persons entitled to receive the distributions, if any, payable under the Plan
upon or after a Participant’s death, to such person, or persons as such
Participant’s Beneficiary. Each Participant shall designate a Beneficiary by
filing the proper form with the Committee. A designation shall be effective
upon said filing, provided that it is so filed during such Participant’s
lifetime. Except with respect to the contingent annuitant option under
Section 7.3(a), a Participant may designate one or more contingent
Beneficiaries to receive any distributions after the death of a prior
Beneficiary and may change his Beneficiary designation from time to time;
provided however, that if he has waived the Preretirement Survivor Annuity or
if he has waived the Qualified Joint and Survivor Annuity, his Spouse must
consent to any change of Beneficiary designation. Any such designation shall
supersede all prior designations under the Plan. Such consent shall be in
writing, shall acknowledge the effect of the consent, and shall be witnessed by
the Plan representative (who shall be individuals appointed by the Committee)
or a notary public. Consent by a Spouse shall be effective only with the
respect to such Spouse and shall be effective only with respect to the
Beneficiary named on the designation (unless the Spouse’s consent expressly
permits designations by the Participant without any requirement of further
consent by the Spouse). The consent of the Spouse shall not be required if it
is established to the satisfaction of the Committee that such consent cannot be
obtained because there is no spouse, because the spouse cannot be located, or
because of other circumstances as the Secretary or Treasury may prescribe in
regulations.


 


If the Beneficiary designated by a Participant dies before the
Participant or before complete distribution of the Participant’s benefit, or if
the Participant has not designated a Beneficiary in the manner required by this
Section, such Participant’s benefit (or the balance thereof) shall be paid as
follows:


 


(a)                                  To the Surviving Spouse to the Participant.


 


(b)                                 If there is no Surviving Spouse, in equal
shares to the living children of the Participant and to the issue of a deceased
child who shall take, per  stirpes, the share the deceased child
would have received if living.


 


(c)                                  If there is no Surviving Spouse and no
surviving issue, to the estate of such Participant.


 


Beneficiary for a Transferred Employee for the period prior to
May 14, 1999 shall be as reflected in the attached Addendum (Beneficiary).


 


2.9                                 “Benefit Commencement Date” means the
date as of which a benefit commences, as determined under the applicable
provision of Article 6.


 


2.10                           “Board” or “Board of Directors” means
the Board of Directors of Blue Ridge Paper Products Inc.


 


6

















 


2.11                           (a)                                  “Break in Service” means a Severance
of at least twelve (12) consecutive months but excluding any time spent on a
Leave of Absence or in Disability status.


 


(b)                                 (1)                                  Anything in the foregoing to the contrary
notwithstanding, in the case of an Employee who incurs an absence from work for
a reason described in (2) below, a Break in Service shall not begin earlier
than one year after it would otherwise begin.


 


(2)                                  The absences from work to which (1) above
applies are an absence:


 


(A)                              by reason of the pregnancy of the individual,


 


(B)                                by reason of the birth of a child of the
individual,


 


(C)                                by reason of the placement of a child with
the individual in connection with the adoption of such child by such
individual, or


 


(D)                               for purposes of caring for such child for a
period beginning immediately following such birth or placement.


 


(E)                                 by reason of a period of unpaid leave that is
required to be allowed by the Family and Medical Leave Act.


 


(c)                                  Break in Service for a Transferred Employee
for the period prior to May 14, 1999 shall be as reflected in the Plan and
also as reflected in the attached Addendum (Break in Service).


 


2.12                           “Champion” means Champion
International Corporation.


 


2.13                           “Champion Plan” means the Champion
International Corporation Salaried Retirement Plan #001 as in effect on
May 13, 1999.


 


2.14                           “Code” means the Internal Revenue Code
of 1986, as amended from time to time. 


 


2.15                           “Committee” means the Retirement
Committee of Blue Ridge Paper Products Inc. 


 


2.16                           (a)                                  “Disability” means, with respect to a
Participant who was actively employed by the Employer immediately prior
thereto, the determination of disability by the Committee based upon competent
medical evidence:


 


(1)                                  for the first thirty (30) months and subject
to the provisions of (b) below, the inability of a Participant, by reason of
injury or sickness, to perform assigned duties with the Employer; and


 


(2)                                  after thirty (30) months and subject to the
provisions of (b) below, the inability of a Participant, by reason of injury or
sickness, to engage in any gainful occupation or employment for wage or profit
for which the Participant is qualified or may reasonably become qualified.


 


7

















 


(b)                                 Disability shall not include:


 


(1)                                  any period during the first thirty (30)
months during which the Participant is not under the regular care of a
physician;


 


(2)                                  any period during which it is determined that
the Participant has deceptively or fraudulently received disability benefits
under the Long Term Disability Benefits Plan of Blue Ridge Paper Products Inc.


 


(3)                                  any injury or sickness incurred on an
Employer authorized leave of absence unless the resulting disability is covered
under the Long-Term Disability Benefits Plan of Blue Ridge Paper Products Inc.


 


(4)                                  any injury or sickness caused by or resulting
from intentionally self-inflicted injury while sane or self destruction or any
attempt thereat while insane;


 


(5)                                  any injury or sickness caused by or resulting
from alcoholism, drug addiction or the use of any hallucinogenic, provided such
Participant is not confined as a resident patient, while under the care of a
physician, in a legally constituted hospital or an institution specializing in
the care and treatment of alcoholism or drug addiction;


 


(6)                                  any injury or sickness incurred while
committing a felony (but only by a final adjudication thereof); and


 


(7)                                  any injury or sickness incurred as a result
of declared or undeclared war or any act thereof or sustained while in the
military, naval or air service of any country or international authority.


 


2.17                           “Earliest Retirement Age” means the
earliest date on which a Participant could elect to receive retirement benefits
under the Plan.


 


2.18                           “Early Retirement Age” means age
fifty-five (55) and at least ten (10) Vesting Years.


 


Early Retirement Age for Transferred Employees is as reflected above
unless the exceptions in the attached Addendum are applicable (Early Retirement
Age).


 


2.19                           “Effective Date” means the effective
date of the Plan which is May 14, 1999.


 


2.20                           (a)                                  “Eligibility Service” means an
individual’s Service (excluding, to the extent not otherwise taken into
account, periods of Disability and unpaid Leaves of Absences as defined under
Section 2.30(a)), subject to (b), (c) and (d) below.


 


8

















 


(b)                                 A Former Champion Employee shall be credited
with Eligibility Service for his employment with Champion prior to
May 14,1999 as if such service had been service with the Employer.


 


(c)                                  Eligibility Service for an Employee who was
formerly an employee of Westvaco shall be counted from his latest date of hire
with Westvaco, subject to the Break in Service rules in (d) below, as if such
Service had been Service with the Employer.


 


(d)                                 A reemployed person’s prior Eligibility
Service shall be disregarded and he shall be treated as a new Employee for
purposes of determining Eligibility Service if he has incurred a Break in
Service and if he did not have any nonforfeitable right to an Employer-derived
benefit at the time of incurring such Break in Service and if such Break in
Service equals or exceeds the greater of five (5) years or his Eligibility
Service before such Break in Service, provided that such Eligibility Service
before such Break in Service shall be deemed not to include any of such
person’s Eligibility Service not taken into account by reason of any prior
Breaks in Service incurred by him.


 


2.21                           “Eligible Employee” means each
Employee of the Employer and its participating subsidiaries and affiliates
excluding any person who is (1) compensated on an hourly basis, (2) a member of
a collective bargaining unit except where specifically included by mutual
agreement by the representing Union and the Board, (3) a nonresident alien who
receives no earned income from the Employer which constitutes income from
sources within the United States, (4) a nonresident alien on temporary
assignment in the United States, (5) designated by the Employer as a leased
employee, independent contractor or consultant, regardless of whether such
person may be held to be a common law employee of the Employer by a court, the
Internal Revenue Service, or any other relevant federal, state, or local
governmental authority or agency, (6) any person not otherwise described in (5)
above who, without regard to such person’s status by the Employer, is otherwise
a “leased employee”, within the meaning of Section 414(n) of the Code, and
(7) any Employee who is excluded from benefit coverage as part of an employment
agreement or contract.


 


2.22                           “Eligibility Year” means 365 days of
Eligibility Service (whether or not continuous).


 


2.23                           “Employee” means any person employed
by, and actually rendering services for the Employer who receives compensation
other than a pension, severance pay, retainer or fee under contract and who is
classified as an Employee by the Employer for U.S. federal income tax
withholding purposes (whether or not such classification is ultimately
determined to be correct as a matter of law). Only Eligible Employees who have
met the eligibility requirements set forth in Article 3 may become
Participants.


 


For purposes of determining Eligibility Service, Vesting Service, and
Code Section 415 limits and the top heavy plan rules, the term “Employee”
shall also include “leased employees” within the meaning of Section 414(n)
of the Code, which includes any person who is not an Employee of the Employer,
but who has provided services to an Employer, which services are performed
under the primary direction or control of the Employer on a substantially
full-time basis for a period of at least one year, pursuant to an agreement
between the Employer and a leasing organization. Even though a leased employee
is credited with service for the enumerated


 


9

















 


purposes, a leased employee shall not be eligible to participate in the
Plan unless his status changes to that of an Employee, and he otherwise meets
the requirements for participation set forth in Article 3. Contributions
or benefits provided by a “leasing organization” within the meaning of
Section 414(n) of the Code which are attributable to services performed
for the Employer shall be treated as provided by the Employer. Notwithstanding
the above, a leased employee shall not be considered an Employee of the
Employer for any purpose under the Plan if not more than thirty percent (30%)
of the Employer’s nonhighly compensated work force consists of leased
employees, and if such individual is covered by a plan which is maintained by a
leasing organization and if, with respect to such individual, such plan is a
money purchase pension plan with a nonintegrated employer contribution rate of
ten percent (10%) which provides for immediate participation and full and
immediate vesting.


 


If any individual who is not classified as an Employee by the Employer
is thereafter required by the Internal Revenue Service, Department of Labor,
other governmental agency, or any court or other tribunal to be classified as
an Employee, such individual shall not be eligible to participate in the Plan
unless and until the date the Committee designates him as an Employee. Such
designation shall only be prospective.


 


2.24                           “Employer” means Blue Ridge Paper
Products Inc. and any of its subsidiaries or affiliated corporations which has
adopted the Plan, and any successor or successors of any of them.


 


2.25                           “Employment Commencement Date” means,
with respect to an individual, the date on which he first performs an Hour of
Service for the Employer.


 


2.26                           “Entry Date” means the Effective Date
and the first day of each calendar month thereafter.


 


2.27                           “ERISA” means the Employee Retirement
Income Security Act of 1974, as amended from time to time.


 


2.28                           “Former Champion Employee” means any
individual who (1) was actively employed by Champion, as a Salaried Employee,
on May 13, 1999, (2) became a Salaried Employee of the Employer on
May 14, 1999 but (3) was not a Participant in the Champion Plan on
May 13, 1999.


 


2.29                           “Hour of Service” means an hour for
which an individual is paid, or entitled to payment, for work for the Employer.


 


2.30                           “Leave of Absence” means, with respect
to an Employee:


 


(a)                                  any period of time during which he is on an
Employer approved leave of absence, without being paid by the Employer, not in
excess of two (2) years, provided that he returns to the employment of the
Employer on or before the end of such leave of absence; and


 


(b)                                 any period of time during which he remains
absent from active employment with the Employer because of any reason other
than quit, retirement, discharge or death, and during all of which he receives
compensation, directly or indirectly, from the Employer (and as a Salaried
Employee for purposes of determining whether a Break in Service has


 


10

















 


occurred, under Section 2.50(c), for purposes of determining Years
of Credited Service), regardless of its duration, excluding, however, any part
thereof during which he is receiving only unemployment compensation.


 


2.31                           “Named Fiduciary” means Blue Ridge
Paper Products Inc.


 


2.32                           “Normal Retirement Age” means the
later of age sixty-five (65) or the fifth anniversary of the time the
Participant commences participation in the Plan. In the case of a Transferred
Employee who was first hired by Champion prior to January 1, 1988, Normal
Retirement Age shall be sixty-five (65).


 


2.33                           “Normal Retirement Benefit” has the
meaning determined under Section 4.1.


 


2.34                           “Normal Retirement Date” means the
first day of the month coinciding with or next following a Participant’s attainment
of Normal Retirement Age.


 


2.35                           “Participant” means an Employee who
has become a Participant as provided under Article 3 and also means a
former Employee who is entitled to a benefit under the Plan.


 


2.36                           “Plan” means the Retirement Plan for
Salaried Employees of Blue Ridge Paper Products Inc. as set forth in this
document and in any Appendices or Addendum hereto and, if amended at any time,
then as so amended.


 


2.37                           “Plan Assets” means the assets of the
Plan at the particular time applicable.


 


2.38                           “Plan Year” means for the first Plan
Year the period beginning May 14, 1999 and ending December 31, 1999.
Plan Year for each succeeding period means the twelve (12) month period
beginning on January 1 and ending on the following December 31.


 


2.39                           “Postponed Retirement Benefit” has the
meaning determined under Section 4.2(b).


 


2.40                           “Qualified Military Service” means,
with respect to a person employed immediately prior thereto by the Employer,
the period of time that he spends in the Armed Forces of the United States, or
its equivalent recognized pursuant to federal law, provided he returns to the
service of the Employer within such period, if any, as is provided under an
Employer approved leave of absence or as is then provided by law for the
protection of his reemployment rights, and provided he has not been employed
elsewhere before returning to work for the Employer. Contributions, benefits,
and service credit with respect to Qualified Military Service will be provided
in accordance with Section 414(u) of the Code.


 


2.41                           “Reemployment Commencement Date” means
the first day, after a Severance, on which an individual performs an Hour of
Service.


 


2.42                           “Salaried Employee” means any person
employed by the Employer as a Salaried Employee whose pay is customarily
computed on a weekly, biweekly, semi-monthly or monthly basis, at such
locations as may be designated from time to time by the Employer for
participation under the Plan and any salesman at such a location who is paid in
whole or in part on a commission basis; provided however, such an individual
who is a member of a collective


 


11

















 


bargaining
unit shall not be deemed to be a Salaried Employee unless and until the Plan
has been accepted by his duly authorized representatives and his inclusion in
the Plan has been approved by the Employer; and provided further, the term
Salaried Employee shall not include any temporary employee hired for a short
term not to exceed three (3) months, subject to an, extension of thirty (30)
days with prior approval.


 


2.43                           (a)                                  “Service” means the sum of the
following periods (whether or not continuous), provided that no period of time
shall be counted more than once:


 


(1)                                  each period beginning on an individual’s
Employment Commencement Date or Reemployment Commencement Date and ending with
his next Severance;


 


(2)                                  any separation from the service of the
Employer of twelve (12) months or less;


 


(3)                                  any Leave of Absence;


 


(4)                                  any period during which he is in Disability
status;


 


(5)                                  Qualified Military Service;


 


(6)                                  with respect to an individual who was
employed by a company that was merged into or otherwise acquired by the Board
and who was so employed on the date of such merger or other acquisition,
recognition of Service prior to such merger or acquisition shall be determined
by the Committee.  Exhibit A lists such
Service that is recognized by the Committee.


 


(7)                                  with respect to a Transferred Employee his
service, with Champion as if it had been Service with the Employer, subject to
the Break in Service rules.


 


(8)                                  with respect to a Former Champion Employee,
his service with Champion as if such Service had been Service with the
Employer, subject to the Break in Service rules.


 


(9)                                  with respect to an Employee who was a former
employee of Westvaco, his Service from his latest date of hire with Westvaco as
if such Service had been Service with the Employer.


 


(b)                                 For purposes of determining Service (other
than Leaves of Absence or Qualified Military Service) under the Plan, Service
for the following shall be treated as if it were Service for the Employer:


 


(1)                                  each Affiliate; and


 


(2)                                  each predecessor employer within the meaning
of, and to the extent required under, Section 414(a) of the Code.


 


12

















 


(c)                                  Anything in the Plan to the contrary
notwithstanding, in determining an Employee’s Service, he shall be entitled to
such credit, if any, as is required by federal law.


 


2.44                           “Severance” means an absence from the
employment of the Employer and all Affiliates beginning on the earliest of
death, quit, discharge, retirement or the first anniversary of any other
absence (with or without pay).


 


2.45                           (a)                                  “Social Security Benefits” mean the
annual amount of the primary Social Security payments to which a Participant is
entitled (or would be entitled if his employment were covered by Social
Security in the case of a nonresident alien who receives no earned income,
within the meaning of Section 91l(b) of the Code, from the Employer which
constitutes income from sources within the United States, within the meaning of
Section 861(a)(3) the Code), at his Normal Retirement Date (or his
Postponed Retirement Date, if applicable), under the Social Security Act as in
effect at the time as of which such Participant’s benefit under the Plan is
computed (or at the time of his Disability if he retires from a Disability
status), assuming:


 


(1)                                  that his earnings, for any period prior to
the first year for which the Plan has records, are determined by the
application, to his earnings for such year of a salary scale (six percent (6%)
per annum), projected backwards to the later of 1951 or the calendar year of
his 22nd birthday; provided however, each Participant, who has any Service with
the Employer or an Affiliate during any Plan Year beginning after
December 31, 1983, shall have the right to have this actual earnings used
instead of estimated earnings; provided however, each such Participant shall be
provided, with each summary plan description and upon separation from Service,
with written notice of his right to supply actual salary history and of the
financial consequences of failing to supply such history and with a statement
that the Participant can obtain his actual salary history from the Social
Security Administration; and, if, within a reasonable period following the
later of such Participant’s date of separation from Service or the time when he
is notified of the benefit to which he is entitled, the Participant supplies
documentation of his actual salary history, then the Participant’s benefit will
be adjusted to the offset based on actual salary history for years that would
otherwise be estimated pursuant to this paragraph (1);


 


(2)                                  that, if his employment as a Salaried
Employee terminates on or after Early Retirement Age, he will receive no
earnings after the date of such termination which would be treated as wages for
purposes of the Social Security Act, that he elects to commence to receive such
Social Security benefits at the earliest possible age on or after such date,
and that the Social Security amount at his social security retirement age for
purposes of the Social Security Act is reduced by 6.66% for each of the first
three (3) years and five percent (5%) for each remaining year by which such
commencement precedes such social security retirement age; and


 


13

















 


(3)                                  that, if his employment as a Salaried
Employee terminates before he reaches Early Retirement Age and if he is not
subsequently reemployed as a Salaried Employee, he will continue to receive,
until reaching his social security retirement age for purposes of the Social
Security Act, earnings which would be treated as wages for purposes of the
Social Security Act at the same rate he received such earnings from the
Employer at the time such employment terminated.


 


(b)                                 “Social Security Benefits” also
include any annual benefits payable under the Railroad Retirement Act, adjusted
under rules determined by the Committee, which shall be applied in a uniform
and non-discriminatory manner to all Participants under similar circumstances,
to reflect the fact that contributions by the Employer under the Railroad
Retirement Act after January 1, 1974 are greater than those made by the
Participant. Such adjustment shall not be such as to cause the offset for
Railroad Retirement Act benefits to exceed the allowable amount under Revenue
Ruling 70-149, or under any other later Revenue Rulings as may apply.


 


2.46                           “Surviving Spouse” means a
Participant’s Surviving Spouse who, , is the Spouse to whom he was married on
his Benefit Commencement Date except to the extent that a former Spouse is
treated as such, for purposes of the Plan, under a Qualified Domestic Relations
Order as described in Section 414(p) of the Code.


 


2.47                           “Transferred Employee” shall mean an
Employee who was a (1) Participant in the Champion Plan on May 13, 1999;
(2) was actively employed by Champion International Corporation (or one of its
subsidiaries or affiliates on that date) and (3) became a Salaried Employee of
the Employer on May 14, 1999 and a Participant in the Plan.


 


2.48                           “Vesting Service” means an
individual’s Service (in accordance with Section 2.43), but disregarding
each period of Service prior to a Break in Service if, at the time of incurring
such Break in Service, the individual did not have any nonforfeitable right to
an Employer-derived benefit and if the Break in Service equals or exceeds the
greater of five (5) years or his Service before such Break in Service, provided
that such Service before such Break in Service shall be deemed not to include
any such individual’s Service not taken into account under the preceding
sentence by reason of any prior Breaks in Service incurred by him.


 


(a)                                  Vesting Service for a Transferred Employee
prior to May 14, 1999 shall be credited to him from his date of hire with
Champion, subject to the Break in Service rules above, as if such Service had
been Service with the Employer.


 


(b)                                 Vesting Service for a Former Champion
Employee prior to May 14, 1999, shall be credited to him from his date of
hire with Champion, subject to the Break in Service rules above, as if such
Service had been Service with the Employer.


 


(c)                                  Vesting Service for an Employee who was a
former Westvaco employee shall be credited to him from his latest date of hire
with Westvaco, subject to the Break in Service rules above, as if such Service
had been Service with the Employer.


 


2.49                           “Vesting Year” means 365 days of
Vesting Service (whether or not continuous).


 


14

















 


2.50                           (a)                                  “Years of Credited Service”, with
respect to a Participant, mean the sum of the following:


 


(1)                                  each Plan Year from and after the Effective
Date, a fraction, expressed as a percentage (not exceeding 100 and rounded up
to the nearest whole percentage point) of a year, equal to his Actual Earnings
divided by his Adjusted Earnings;


 


(2)                                  Pre May 14, 1999 Service For Transferred
Employees, all of their
Service that was taken into account for benefit accrual and payment purposes,
as of May 13,1999, under the Champion Plan, subject to the Break in
Service Rules.


 


(3)                                  Pre May 14, 1999 Service For Former
Champion Employees, all of
their Service that was taken into account for benefit accrual and payment
purposes, as of May 13, 1999, under the Champion Plan, subject to the
Break in Service Rules.


 


(4)                                  Noncovered Years, all of his years of active Service with the
Employer since his last date of hire into or transfer to hourly employee status
prior to his transfer to Salaried Employee status if (A) he becomes a
Participant in the Plan, and (B) he is credited with two (2) or more
consecutive Years of Credited Service immediately following such transfer to
Salaried Employee status. See the Addendum (Years of Credited Service);


 


(5)                                  Qualified Military Service, service with which he would have been
credited had he not been in Military Service;


 


(6)                                  Predecessor Service, in the case of a Participant who was
employed by a company that was merged into or otherwise acquired by the Board
and who was so employed on the date of such merger or other acquisition,
recognition of Service prior to such merger or acquisition shall be determined
by the Committee. Exhibit A lists such Service that is recognized by the
Committee.


 


(b)                                 Disability. For purposes of (a)(l) above, during any period (up to his Normal
Retirement Age) when a Participant has a Disability, he shall be deemed to have
the same Actual Earnings and Adjusted Earnings as for the Plan Year immediately
preceding the Plan Year during which he incurred his Disability.


 


(c)                                  Rule of Parity. If the individual did not have a
nonforfeitable right to an Employer derived benefit prior to a Break in
Service, and if the length of such Break in Service equals or exceeds the
greater of five (5) years or his Service (whether or not continuous) prior to
such Break in Service, then his Years of Credited Service shall be disregarded.
Prior Service shall not include any periods disregarded under Section 2.48
by reason of any prior Break in Service.


 


15

















 


(d)                                 Other Federal Law. Anything in the Plan to the contrary
notwithstanding, in determining a Participant’s Years of Credited Service, he
shall be entitled to such credit, if any, as is required by federal law.


 


16

















 


ARTICLE 3


 


ELIGIBILITY AND
PARTICIPATION


 


3.1                                 Transferred Employees. Any Eligible Employee who is a Transferred
Employee shall become a Participant in the Plan on May 14, 1999.


 


3.2                                 New Employees. Any Eligible Employee who is a Former
Champion Employee shall become a Participant in the Plan on the first day of
the month coinciding with or following the date on which such Former Champion
Employee is credited with at least one Year of Eligibility Service. Such
Service shall be based on Service with Champion prior to May 14, 1999 and
with the Employer thereafter. Each other Eligible Employee shall become a
Participant in the Plan on the first day of the month coinciding with or next
following the date on which such Eligible Employee is credited with at least
one Year of Eligibility Service but based on Service with the Employer.


 


3.3                                 Absences and Severances of Less Than Twelve
(12) Months.


 


(a)                                  Absences. If, on the Entry Date determined under Section 3.2, an Eligible
Employee is absent from employment for reasons other than quit, discharge, or
retirement, and if he returns to employment within twelve (12) months, then,
upon the termination of such absence, and provided he is a Salaried Employee,
he shall become a Participant retroactive to such Entry Date.


 


(b)                                 Severances. If an Eligible Employee’s Entry Date determined under Section 3.2
falls within a period of Severance of twelve (12) months or less taken into
account as Service under Section 2.43 he shall become a Participant on the
date on which such period of Severance ends.


 


3.4                                 Reemployment of Former Participant. If a former Participant is reemployed by the
Employer and is an Eligible Employee, then provided that he meets the
requirements of Section 3.2, he shall become a Participant again as of the
date of such reemployment.


 


17

















 


ARTICLE 4


 


ACCRUAL OF RETIREMENT
BENEFITS


 


4.1                                 Normal Retirement Benefit. A Participant’s “Normal Retirement Benefit”
shall be his Accrued Benefit as of the earlier of his Normal Retirement Age or
the termination of his employment as a Salaried Employee, but not less than the
highest periodic benefit, payable in the same form but adjusted in accordance
with applicable Treasury Regulations, which he would have received if he had
retired early under Section 6.2.


 


4.2                                 Accrued Benefit.


 


(a)                                  Formula. A Participant’s “Accrued Benefit” at any particular time, shall be an
annual benefit, commencing at his Normal Retirement Date and payable in monthly
installments in the form provided in Section 7.1, in an amount equal to:


 


(1)                                  1.667 percent of his Average Earnings times
his Years of Credited Service (not in excess of 30); minus


 


(2)                                  1.667 percent of his Social Security Benefits
times his Years of Credited Service (not in excess of 30); plus


 


(3)                                  0.5 percent of his Average Earnings times his
Years of Credited Service in excess of 30.


 


(b)                                 Postponed Retirement Benefit. If a Participant retires after his Normal
Retirement Date, then his “Postponed Retirement Benefit” shall be an annual
benefit, commencing at his Benefit Commencement Date and payable in the form
provided in Section 7.1, determined under the same formula prescribed
under Section 4.2(a) (including Years of Credited Service after Normal Retirement
Date but excluding Years of Credited Service in excess of 30).


 


(c)                                  General Offsets.


 


(1)                                  Offset for Retirement Benefit Received Prior
to Reemployment. If a
Participant who has received a retirement benefit under the Plan is reemployed
by the Employer, then the amount of the retirement benefit, if any, to which he
is entitled subsequent to such reemployment shall be reduced by the Actuarial
Equivalent of the aggregate amount of such retirement benefit which he received
prior to his retirement from such reemployment, to the extent that it was
accrued with respect to his Years of Credited Service that are taken into
account in computing such subsequent retirement benefit, if any; provided
however, such reduction shall be limited so as not to result in a periodic
benefit lower than any periodic benefit (actuarially adjusted for any different
form of payment) which the Participant was receiving immediately prior to his
reemployment.


 


18

















 


(2)                                  Offset for Transferred Employee. If a Participant who is a Transferred
Employee is entitled to a benefit under the Champion Plan and if his period of
participation thereunder also constitutes Years of Credited Service with
respect to him under this Plan, then his retirement benefit computed under (a)
above, shall be reduced by the then Actuarial Equivalent of the amount of the
retirement benefit payable to him under such Champion Plan which accrued to his
benefit thereunder as of May 13, 1999.


 


(3)                                  Offset for Benefits Under Other Qualified
Pension Plans. If a
Participant is entitled to a retirement benefit under a qualified pension plan
other than the Plan, to which the Employer, its subsidiary and/or affiliated
corporations contributed, then his retirement benefit, computed under (a)
above, shall be reduced by the then Actuarial Equivalent of the amount of the
retirement benefit then payable to him under such other plan which is
attributable to the contributions of the Employer, its subsidiary and/or
affiliated corporations to such other plan and which has accrued to his benefit
thereunder for such period of service as is taken into account thereunder for
benefit accrual purposes, which also constitutes Years of Credited Service with
respect to him under the Plan.


 


(4)                                  Offset for Benefits for Employees Transferred
from Hourly to Salaried Employment Status. If a Participant is transferred from hourly employment status to
salaried employment status, his Years of Credited Service shall be counted
under the Plan in accordance with Section 2.50(a)(4). His retirement
benefit computed under (a) above shall be reduced by the then Actuarial
Equivalent of the amount of the retirement benefit payable to him under the
hourly retirement plan sponsored by the Employer which accrued to his benefit thereunder
as of the date of change from hourly to salaried employment status.


 


(5)                                  Offset for Predecessor Plans. A Participant’s retirement benefit computed
under (a) above, shall be reduced by the Actuarial Equivalent of any retirement
income received, with respect to the Service taken into account under this
Plan, under the provisions of any retirement or pension plan of a Predecessor
employer.


 


Any additional offsets for Transferred Employees are as reflected in
the attached Addendum (Article 4, Offset for Pre-1975 Plan Withdrawal
Right Amount, Offset for Certain Amounts Paid or Payable under Champion
International Corporation Saving Plan #077, Offset for Certain Account under
Champion International Corporation Saving Plan #077, and Offset for Benefits under
St. Regis Corporation Retirement Plan for Salaried Employees).


 


4.3                                 Social Security Benefit Increases.


 


(a)                                  Definition. For purposes of this Section, the term “Post-Separation Social
Security Benefit Increase” means, with respect to a Participant or a Beneficiary
of such Participant, an increase in a benefit level or wage base under Title II
of the Social Security Act (whether such increase is a result of an amendment
of such Title II or is a


 


19

















 


result of the application of the provisions of such Title II) and/or
any such increase under any comparable provisions of the Railroad Retirement
Act, occurring after the earlier of such Participant’s separation from service
or commencement of benefits under the Plan.


 


(b)                                 Benefit Being Received by a Participant or a
Beneficiary. A benefit
(including a death or disability benefit) being received under the Plan by a
Participant or a Beneficiary (other than a Participant to whom (c)(2) below
applies or a Beneficiary of such a Participant) shall not be decreased by
reason of any Post-Separation Social Security Benefit increase effective after
the later of (1) September 2, 1974, or (2) the date of first receipt of
any retirement benefit, death benefit, or disability benefit under the Plan by
such Participant or a Beneficiary of such Participant (whichever receipt occurs
first).


 


(c)                                  Benefit to Which a Participant Separated From
Service Has Nonforfeitable Right. In the case of a benefit to which a Participant has a nonforfeitable
right under the Plan:


 


(1)                                  if such Participant is separated from service
and does not subsequently return to service and resume participation in the
Plan, then such benefit shall not be decreased by reason of any Post-Separation
Social Security Benefit Increase effective after the later of (1)
September 2, 1974, or (2) separation from service; or


 


(2)                                  if such Participant is separated from service
and subsequently returns to service and resumes participation in the Plan, then
such benefit shall not be decreased by reason of any Post-Separation Social
Security Benefit Increase effective after September 2, 1974, which occurs
during separation from service and which would decrease such benefit to a level
below the level of benefits to which he would have been entitled had he not
returned to service after his separation


 


4.4                                 Grandfathered Benefit for Transferred
Employee.  If a Transferred Employee is entitled to a
benefit under the Plan, then such benefit from the Plan shall not be less than
a monthly retirement benefit equal to the monthly retirement benefit which he
would have received under the Champion Plan if he had continued as a
Participant under the Champion Plan.


 


See the attached Addendum for other Grandfathered Benefits for
Transferred Employees (Article 4, Grandfathered Benefits for Pre-1975
Champion Plan Participants, Grandfathered Benefits for Former Hoerner Waldorf
Employees, and Grandfathered Benefits for Former St. Regis Employees).


 


4.5                                 No Duplication of Benefits Between Plans. If a Participant is entitled to a retirement
benefit under a qualified pension plan, other than the Plan, to which the
Employer and/or its subsidiary and/or affiliated corporations contributed,
which benefit was accrued for a period of service that has been taken into
account as a period of service for accruing his retirement benefit under the
Plan, then the provisions of either paragraph (a) or (b) below shall apply:


 


(a)                                  if such other retirement benefit was accrued
prior to his accruing benefits under the Plan, his benefit payable under the
Plan shall be subject to Section 4.2(c)(3);


 


20

















 


(b)                                 if such retirement benefit was accrued
subsequent to his accruing benefits under the Plan, then his benefit payable
under the Plan shall be in the amount that would have been payable had he
terminated his employment with the Employer as of the date that he transferred
to another plan.


 


4.6                                 Effect of Plan Amendments on Computation of
Benefits. Except as
otherwise specifically provided, no amendment which relates to the amount of
benefits under the Plan and which becomes effective after any termination of a
Participant’s status as a Salaried Employee shall apply with respect to that
part of any benefit under the Plan which is computed with respect to his
Service prior to such termination.


 


21

















 


ARTICLE 5


 


VESTING


 


5.1                                 Vesting At Normal Retirement Age. Upon and after a Participant’s attainment of
Normal Retirement Age, if he is then in the service of the Employer or an
Affiliate, he shall have a nonforfeitable right to his Normal Retirement
Benefit, or his Postponed Retirement Benefit, whichever is applicable.


 


5.2                                 Vesting in Accrued Benefit Prior to Normal
Retirement Age. Except as
otherwise provided in the Plan, a Participant shall have a nonforfeitable right
to a percentage of his Accrued Benefit on the basis of the number of Vesting
Years or Years of Credited Service, whichever are greater, with which he is
credited, pursuant to the following vesting schedule:


 


	
  Vesting Years or

  Years of Credited Service

  whichever are greater

  	
   

  	
  Nonforfeitable

  Percentage

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Less than 5

  	
   

  	
  0

  	
  %

  
	
  5 or more

  	
   

  	
  100

  	
  %

  



 


5.3                                 Forfeiture on Account of Death. Anything in the foregoing to the contrary
notwithstanding, except as otherwise provided in Articles 7 and 8, a
Participant’s benefits shall be forfeited if the Participant dies prior to
earning a vested benefit under the Plan.


 


5.4                                 Vesting Upon Termination or Partial
Termination of the Plan.
Anything in the foregoing to the contrary notwithstanding, upon the complete
termination or partial termination of the Plan, the rights of all affected
Participants to benefits accrued to the date of such complete termination or
partial termination, to the extent funded as of such date, shall be
nonforfeitable.


 


5.5                                 Limitation on Recourse. In the event of a complete or partial
termination of the Plan, a Participant or Beneficiary shall not have any
recourse towards satisfaction of his nonforfeitable benefits from other than the
Plan Assets or the Pension Benefit Guaranty Corporation.


 


5.6                                 Unclaimed Benefits. Notwithstanding anything in the Plan to be
contrary, if a Participant or other person entitled to a benefit has not been
found within two (2) years after such payment becomes due or if a check for
payment of a benefit has not been cashed within two (2) years of the date it
was drafted, then such benefit shall be forfeited. However, if such Participant
or other person is thereafter located, then such benefit shall be restored
retroactively no later than sixty (60) days after the date on which such
Participant or other person is located, and shall be in the same amount as was
payable at the time such benefit became due without any adjustment for the time
between the date such benefit became due and such restoration.


 


22

















 


ARTICLE 6


 


ENTITLEMENT TO RETIREMENT
BENEFITS


 


6.1                                 Normal Retirement.


 


(a)                                  If a Participant retires from the service of
the Employer on or after his attainment of Normal Retirement Age and on or
before his Normal Retirement Date, he shall be entitled, as of his Benefit
Commencement Date, to his Normal Retirement Benefit.


 


(b)                                 The “Benefit Commencement Date” of a
Participant whose retirement occurs under (a) above shall be his Normal
Retirement Date.


 


6.2                                 Early Retirement.


 


(a)                                  If a Participant retires from the service of
the Employer on or after his attainment of Early Retirement Age (as defined in
Section 2.18) but before his attainment of Normal Retirement Age (as
defined in Section 2.32), he shall be entitled, as of his Benefit
Commencement Date, to his Accrued Benefit determined as of the termination of
his employment as a Salaried Employee, reduced by four tenths of one percent
(.4%) for each month, if any, by which his Benefit Commencement Date precedes
the date on which he would reach age 62.


 


(b)                                 The “Benefit Commencement Date” of a
Participant whose retirement occurs under (a) above shall, subject to
Section 7.4, be the first day of any month coinciding with or next
following his retirement from the service of the Employer and its subsidiary
and affiliated corporations and, with respect to a Participant who worked at a
divested location, from any purchaser of such location, but not later than his
Normal Retirement Date, which day he shall select.


 


6.3                                 Postponed Retirement.


 


(a)                                  If a Participant’s employment terminates
after his Normal Retirement Date, then he shall be entitled as of his Benefit
Commencement Date, to the greater of his Postponed Retirement Benefit (as
reflected in Section 4.2(b)) or the Actuarial Equivalent (as of his
Benefit Commencement Date) of the benefit to which he would have been entitled
if he had retired on his Normal Retirement Date.


 


(b)                                 The “Benefit Commencement Date” of a
Participant whose retirement occurs under (a) above shall, subject to the
notification and other requirements of Labor Regulation
Section 2530.203-3, be the first day of the month coinciding with or next
following the termination of his Section 203(a)(3)(B) service as defined
in such Regulation; provided however, subject to Section 9.2, his Benefit
Commencement Date shall in no event be later than the latest date permitted
under Section 7.4(c).


 


23

















 


(c)                                  If a Participant continues as an Employee
after his Benefit Commencement Date under (b) above, benefits shall continue to
accrue nevertheless for each Plan Year until he terminates employment, subject
to the minimum benefit requirements (if applicable) of Section 15.2, under
the same formula prescribed under Section 4.2 (including Plan Years after
the Benefit Commencement Date), determined as a monthly benefit payable in the
form provided in Section 7.1 commencing upon the close of the Plan Year of
the additional accrual. As of the first date benefit payments are due a
Participant each Plan Year commencing after his Benefit Commencement Date under
(b) above, the Participant’s benefit payments (under the same form in which
payments are being made) shall be increased to reflect the excess (if any) of
the Actuarial Equivalent of this additional accrual less the Actuarial
Equivalent of the lesser of (i) the total Plan benefit payments to the
Participant through the end of the immediately preceding Plan Year, or (ii) the
total Plan benefit payments to the Participant which would have been made to
the Participant through the end of the immediately preceding Plan Year if such
payments had been made in the basic form of benefit under Section 7.1;
provided however, if as of the Participant’s Benefit Commencement Date under
(b) above, the Participant received his benefit as a lump sum, the increase (if
any) shall also be paid as a lump sum as soon as administratively feasible
after the Plan Year of the additional accrual.


 


6.4                                 Termination of Employment.


 


(a)                                  A Participant whose employment has terminated
but who is not entitled to a benefit under any of the preceding Sections of
this Article 6 shall, unless distribution has been made pursuant to
Section 7.4(d), be entitled, as of his Benefit Commencement Date, to the
nonforfeitable part of his Accrued Benefit determined as of the termination of
his employment as a Salaried Employee, reduced by 1/180 for each of the first
sixty (60) months and 1/360 for each of the next sixty (60) months by which his
Benefit Commencement Date precedes his Normal Retirement Date.


 


(b)                                 The “Benefit Commencement Date” of a
Participant to whom (a) above applies shall be his Normal Retirement Date;
provided however, if a Participant is not employed by the Employer or any of
its subsidiary or affiliated corporations or, with respect to a Participant who
worked at a divested location, by any purchaser of such location, then, subject
to Section 7.4, he may elect as his Benefit Commencement Date the first
day of any month, not later than his Normal Retirement Date, which coincides
with or follows his attainment of age fifty-five (55) provided he has completed
at least ten (10) Years of Vesting Service, or if such Participant is a
Transferred Employee he has met the requisite Years of Vesting Service set
forth in the Addendum to the Plan.


 


See the attached Addendum for provisions regarding Transferred
Employees who terminate employment and are not entitled to a benefit under
Sections 6.1, 6.2 and 6.3 (Article 6, Termination of Employment).


 


6.5                                 Effect of Reemployment. If, in any calendar month subsequent to the
commencement of benefit payments, a Participant is reemployed in
Section 203(a)(3)(B) service, as defined in Labor Regulation
Section 2530.203-3, and if such benefits are not being paid under an
insurance or annuity contract which precludes a refund to the Plan of suspended
payments, then, subject to the notification and other requirements of such
Regulation, payment of Employer-derived


 


24

















 


benefits
in excess of any minimum benefits under Section 15.2
shall be suspended for such month.


 


6.6                                 Benefit Payments. Benefit payments under this Plan shall be
paid only if the Committee decides in its discretion that the Participant or
Beneficiary or other applicant is entitled to such payment.


 


6.7                                 Recovery of Payments Made by Mistake. Notwithstanding anything to the contrary, a
Participant or Beneficiary is entitled to only those benefits provided by the
Plan and promptly shall return any payment, or portion thereof, made by mistake
of fact or law. Further, notwithstanding anything to the contrary, an alternate
payee under a Qualified Domestic Relations Order is entitled to only those
benefits from the Plan as are designated by the Order and promptly shall return
any payment, or portion thereof, made by mistake of fact or law. The Committee
may offset the future benefits of any recipient who refuses to return an
erroneous payment, in addition to pursuing any other remedies provided by law.


 


25

















 


ARTICLE 7


 


FORMS AND PAYMENT OF
RETIREMENT BENEFITS


 


7.1                                 Basic Form of Participant’s Benefit Single
Life Annuity. Except as
otherwise provided by Section 7.2 and subject to the provisions of
Section 7.3 regarding optional forms of benefit, the basic form of a
Participant’s benefit under the Plan shall be a single life annuity that is
payable in equal monthly installments, each in an amount equal to the monthly
benefit to which he is entitled under the Plan, commencing as of his Benefit
Commencement Date and continuing until the payment of the installment due on
the first day of the month in which he dies.


 


7.2                                 Qualified Joint and Survivor Annuity.


 


(a)                                  Automatic Basic Form. Unless the waiver provided for in (c) below
is effective with respect to a Participant (including an unmarried
Participant), the form of payment with respect to him under the Plan shall be a
Qualified Joint and Survivor Annuity (defined in (b) below).


 


(b)                                 Qualified Joint and Survivor Annuity. A “Qualified Joint and Survivor Annuity” is
an immediate annuity which is the Actuarial Equivalent of the basic form of
benefit under Section 7.1 and which:


 


(1)                                  for a married Participant (including a
Participant who is subject to an applicable Qualified Domestic Relations Order
as described in Section 414(p) of the Code), provides a lifetime benefit
for the Participant and a lifetime survivor benefit for his Surviving Spouse
equal to fifty percent (50%) of the benefit payable to the Participant during
their joint lives; or


 


(2)                                  for a single Participant, provides payments
for the life of the Participant only.


 


(c)                                  Waiver.


 


(1)                                  Election Period. A Participant may waive the Qualified Joint
and Survivor Annuity form of benefit at any time during a ninety (90) day
election period ending on his Benefit Commencement Date. Such a waiver must be
in writing and must specify the optional form of benefit elected and the
specific Beneficiary or Beneficiaries, if any, to whom any death benefits under
the optional form will be payable.


 


(2)                                  Revocation. A Participant may also revoke any waiver under (1) above during the
election period thereunder. There shall be no limitation on the number of such
elections and revocations permitted during such election period.


 


26

















 


(3)                                  Written Explanation. The Committee shall provide to each
Participant, no less than thirty (30) days and no more than ninety (90) days
prior to his Benefit Commencement Date (and consistent with such regulations as
the Secretary of the Treasury may prescribe), a written explanation of:


 


(A)                              the terms and conditions of the Qualified
Joint and Survivor Annuity,


 


(B)                                the Participant’s right to make, and the
effect of, an election under (1) above to waive the Qualified Joint and
Survivor Annuity form of benefit,


 


(C)                                the rights of the Participant’s Spouse under
(4) below,


 


(D)                               the right to make, and the effect of, a
revocation of an election under (1) above; and


 


(E)                                 the eligibility requirements, material
features and relative values of any optional form of benefit under the Plan.


 


However, a Participant may
elect (with applicable spousal consent) to waive the requirement that the
written explanation be provided at least thirty (30) days before the Benefit
Commencement Date, if the distribution commences more than seven (7) days after
such written explanation is provided.


 


(4)                                  Spousal Consent. A waiver of the Qualified Joint and Survivor
Annuity shall not take effect with respect to a Spouse of a Participant unless:


 


(A)                              such Spouse consents in writing to such
election, and such Spouse’s consent:


 


(i)                                     acknowledges the effect of such election,


 


(ii)                                  acknowledges the specific Beneficiary or
Beneficiaries, if any, to whom any death benefits under the Plan will be
payable, which may not be changed without spousal consent, and


 


(iii)                               acknowledges the specific optional form of
benefit elected which may not be changed without spousal consent, and


 


(iv)                              is witnessed by a Plan representative or a
notary public; or


 


(B)                                it is established to the satisfaction of a
Plan representative that the consent required under (A) above may not be
obtained because there is no Spouse, because the Spouse cannot be located, or
because of such other circumstances as may be provided in regulations of the
Internal Revenue Service.


 


27

















 


7.3                                 Optional Forms of Benefit. Subject to an effective waiver of the
Qualified Joint and Survivor Annuity, if applicable, a Participant may, by
filing the proper form with the Committee prior to his Benefit Commencement
Date, elect to receive his benefit under the Plan in one or a combination of
the following forms. Such benefit shall be the Actuarial Equivalent of the
basic form of benefit under Section 7.1.


 


(a)                                  Contingent Annuitant Option.


 


(1)                                  Under the contingent annuitant option, a
Participant shall be entitled to a monthly benefit commencing as of his Benefit
Commencement Date and terminating with the monthly payment due on the first day
of the month in which his death occurs.


 


(2)                                  Upon such Participant’s death, on or after
his Benefit Commencement Date, a contingent benefit shall be payable to the
Beneficiary designated by him at the time he elects this option, if such
Beneficiary is then living.


 


(3)                                  Such contingent benefit shall commence as of
the first day of the month next following the calendar month in which the death
of such Participant occurs and shall terminate with the monthly payment due on
the first day of the month in which the death of his designated Beneficiary
occurs.


 


(4)                                  The monthly amount of contingent benefit
payable to such Participant’s designated Beneficiary shall be equal to fifty
percent (50%), seventy-five percent (75%), or one hundred percent (100%), as
the Participant may elect, of the monthly benefit payable under this option to
such Participant during the joint lives of him and such designated Beneficiary.


 


(5)                                  This option shall not be effective with
respect to a Participant, unless within ninety (90) days after his election of
such optional form, but not later than the thirty (30) days prior to his
Benefit Commencement Date, he furnishes evidence satisfactory to the Committee
of the date of birth of his designated Beneficiary and unless his designated
Beneficiary is alive on his Benefit Commencement Date. However, a Participant
may elect with applicable spousal consent to waive any requirement that the
written explanation be provided at least thirty (30) days before the Benefit
Commencement Date, if the distribution commences more than seven (7) days after
such explanation is provided.


 


(b)                                 Life-Term Certain Option.


 


(1)                                  Under the life-term certain option, a
Participant shall be entitled to a monthly benefit commencing as of his Benefit
Commencement Date, payable during his remaining lifetime; provided that if such
Participant dies on or after his Benefit Commencement Date and before he has
received sixty (60), one hundred twenty (120), one hundred eighty (180), or two
hundred forty (240) monthly payments, which number of monthly payments shall be
specified by him at the time he elects this option, then


 


28

















 


such specified number of monthly payments shall be continued in the
same amount to his designated Beneficiary or Beneficiaries until the aggregate
number of such payments made to such Participant and such Beneficiary or
Beneficiaries equals such specified number of monthly payments.


 


(2)                                  (2)                                  In the event of the death of such Participant
and all of his designated Beneficiaries before the guaranteed number of monthly
payments has been made, then the commuted value of the balance of such payments
shall be paid, in such form (which form shall be a lump sum, installments, or
any combination of the foregoing) as the recipient shall elect to such
Participant’s Beneficiary as determined under Section 2.8.


 


(c)                                  Full Cash Refund Annuity Option. Under the full cash refund annuity option, a
Participant is entitled to a benefit commencing as of his Benefit Commencement
Date and terminating with the payment due on the first day of the month in
which his death occurs. Upon his death, on or after his Benefit Commencement
Date, the excess, if any, of the lump sum Actuarial Equivalent (as of his
Benefit Commencement Date) of his benefit under the Plan over the aggregate
amount of benefit payments received by him shall be payable to his designated
Beneficiary, which form may be a lump sum, installments, or any combination
thereof. In the event of the death of such Participant and all of his designated
Beneficiaries before all of the payments provided for above under this option
have been made, then the amount of any remaining payments shall be paid, in
such form (which form shall be a lump sum, installments, or any combination of
the foregoing) after consultation with the recipient, to such Participant’s
Beneficiary as determined under Section 2.8.


 


(d)                                 Social Security Adjustment Option For Early
Retirement.


 


(1)                                  Under the Social Security adjustment option,
if a Participant is entitled to an early retirement benefit under
Section 6.2 and if his Benefit Commencement Date is prior to the date he
is expected to become entitled to receive social security benefits under Title
II of the Social Security Act, then, he may elect to have his retirement benefit
payments under the Plan adjusted so that the monthly payments due to him under
the Plan together with the monthly payments of social security benefits
expected to become payable to him shall form, as nearly as is practicable, a
uniform series of payments. Such adjustment shall consist of a reduced
retirement benefit payable for the lifetime of such Participant, plus a
temporary retirement benefit payable until the earlier of his death and the
date specified by him pursuant to (2) below.


 


(2)                                  At the time such Participant elects this
option, he must specify the date of the commencement, and the monthly amount,
of social security benefits that he expects to receive, and any specific change
in such date or such amount shall have no effect on the amount of lifetime
retirement benefit and temporary retirement benefit payable to him under this
option.


 


29

















 


The terms of any annuity contract purchased
and distributed by the Plan to a Participant or Spouse shall comply with the
requirements of this Plan. Any annuity contract distributed here from must be
nontransferable.


 


For a Transferred Employee, see the attached Addendum regarding
Pre-1975 withdrawal Rights (Article 7, Pre-1975 Champion Plan
withdrawal Right).


 


7.4                                 Date of Payment and Cash-out.


 


(a)                                  General. Subject to the Subsections below, a Participant’s benefit shall
commence as of his Benefit Commencement Date determined under Article 6.


 


(b)                                 Consent to Early Payment.


 


(1)                                  Except as provided in (c) and (d) below, no
part of a Participant’s benefit may be paid to him prior to Normal Retirement
Age unless he consents to the distribution.


 


(2)                                  Written Explanation. The Committee shall provide to each
Participant whose consent is required under (1) above, no less than thirty (30)
days and no more than ninety (90) days prior to his Benefit Commencement Date,
a written explanation of the material features and relative values of the
optional forms of benefit under the Plan, and his right (if any) to defer
receipt of the distribution. However, a Participant may elect (with applicable
spousal consent) to waive any requirements that the written explanation be
provided at least thirty (30) days before the Benefit Commencement Date if the
distribution commences more than seven (7)  days after such written explanation is provided.


 


(3)                                  Time of Consent. A Participant’s consent to a distribution
must not be made before he receives the written explanation under (2) above and
must not be made more than ninety (90) days before his Benefit Commencement
Date.


 


(c)                                  Latest Date of Payment. The payment of a Participant’s benefit under
the Plan shall begin not later than sixty (60) days after the latest of:


 


(A)                              The close of the Plan Year in which the
Participant attains age 65;


 


(B)                                The close of the Plan Year in which occurs
the 10th anniversary of the year in which the Participant commenced
participation in the Plan; or


 


(C)                                The close of the Plan Year in which the
Participant terminates his employment with the Employer.


 


(D)                               If the Participant is a 5 percent (5%) owner
and continues employment to age 70 1/2, the April 1 of the calendar year
following the calendar year in which such Participant attains age 70 1/2.


 


30

















 


The purpose of this
Section is to provide a limitation on the latest date on which payment of
benefits under the Plan can commence. This Section shall not preempt other
Sections of the Plan which require or permit payment of benefits at an earlier
date.


 


Notwithstanding the above, the
failure of a Participant and his Spouse, where applicable, to consent to a
distribution while a benefit is distributable shall be deemed to be an election
to defer commencement of payment of any benefit sufficient to satisfy this
Section.


 


(d)                                 Cash-Out Distributions.
Any other provisions of the Plan to the contrary notwithstanding, any amount
payable to a Participant under the Plan shall be paid in a lump sum provided
that the Actuarial Equivalent of the Participant’s nonforfeitable benefit under
the Plan determined as of the earlier of his Benefit Commencement Date (or
other date as of which benefits under the Plan are to commence), does not
exceed $5,000 and such payment is made before payment otherwise begins. Such
lump sum shall be paid as soon as administratively feasible on or after such
Benefit Commencement Date (or other date as of which benefits under the Plan
are to commence). For purpose of this Section, if the Actuarial Equivalent of
the Participant’s benefit is zero (0), the Participant will be deemed to have
received a distribution of such benefit on the date his employment terminates.
Such distribution shall be in full satisfaction of all benefits to which the
Participant is entitled under the terms of the Plan, and he shall forfeit
Credited Service accrued under the Plan up to the date on which the
distribution is made.


 


If a Participant has received a
distribution equal to the Actuarial Equivalent of the benefit to which he is
entitled in accordance with the above paragraph and is subsequently reemployed,
such Participant may, until the earlier of the date that he has five (5)
consecutive Breaks in Service, or the fifth anniversary of his reemployment,
repay the full amount of the distribution with interest thereon at the rate
determined for purposes of Section 411(c)(2)(C) of the Code on the date of
such repayment computed annually from the date of distribution. For this
purpose, if a Participant was deemed to have received a distribution pursuant
to this Subsection, and he is subsequently reemployed before he has five (5)
consecutive Breaks in Service, he shall be deemed to have made such repayment
on the date of his reemployment. Upon such repayment (or deemed repayment), the
Participant shall, subject to the rules with respect to Broken Service set
forth in Subsection 2.50(c), have included in his credited Service
the period of employment with respect to which he has received the above
distribution.


 


If a reemployed Participant who
has received a distribution equal to the Actuarial Equivalent of the benefit to
which he is entitled elects not to repay the full amount of such distribution
with interest thereon, his Credited Service for purposes of this
Section shall be computed from his date of reemployment.


 


Whether or not the Participant
repays the full amount of the distribution with interest thereon, Eligibility
and Vesting Service shall, subject to the rules with respect to Broken Service
set forth in Subsection 2.50(c), include Eligibility and Vesting Service
rendered prior to his Break in Service.


 


31

















 


When a Participant, who has received a
distribution equal to the Actuarial Equivalent of the benefit to which he is
entitled, is reemployed, the Committee shall notify him of his right to make repayment,
the amount of the required repayment, and the consequences of not making such
repayment.


 


The benefit to which a Participant or his
Surviving Spouse is entitled shall be paid in accordance with other provisions
of the Plan if its Actuarial Equivalent is in excess of $5,000.


 


(e)                                  Qualified Domestic Relations Order
Procedures. To the extent
that a benefit is affected by the determination of whether a domestic relations
order is a qualified domestic relations order, nothing in this
Section shall require a benefit to be distributed earlier than required
under Section 414(p) of the Code.


 


7.5                                 General Rules.


 


(a)                                  Incidental Benefits. All distributions required under this
Article shall be determined and made in accordance with the Proposed
Treasury Regulations under Section 401(a)(9) of the Code including the
minimum distribution incidental benefit requirement of
Section 1.409(a)(9)-2 of the Proposed Treasury Regulations.


 


(b)                                 Distribution Periods.


 


General. As
of the first distribution calendar year, distributions, if not made in a single
sum payment, must be made over one (1) of the following periods (or any
combination thereof):


 


(1)                                  the life of the Participant;


 


(2)                                  the lives of the Participant and his
Beneficiary (if the Beneficiary is an individual);


 


(3)                                  a period certain not extending beyond the
life expectancy of the Participant; or


 


(4)                                  a period certain not extending beyond the
joint life and last survivor expectancy of the Participant and his Beneficiary
(if the Beneficiary is an individual).


 


(c)                                  Determination of amount to be distributed
each year.


 


(1)                                  If the Participant’s interest is to be paid
in the form of annuity distributions under the Plan, payments under the annuity
shall satisfy the following requirements:


 


(A)                              the annuity distributions must be paid in
periodic payments made at intervals not longer than one year;


 


32

















 


(B)                                the distribution period must be over a life
(or lives) or over a period certain not longer than a life expectancy (or joint
life and last survivor expectancy) described in Section 401(a)(9)(A)(ii)
or Section 401(a)(9)(B)(iii) of the Code, whichever is applicable;


 


(C)                                the life expectancy (or joint life and last
survivor expectancy) for purposes of determining the period certain shall be
determined without recalculation of life expectancy;


 


(D)                               once payments have begun over a period
certain, the period certain may not be lengthened even if the period certain is
shorter than the maximum permitted;


 


(E)                                 payments must either be nonincreasing or
increase only as follows:


 


(i)                                     with any percentage increase in a specified
and generally recognized cost-of-living index;


 


(ii)                                  to the extent of the reduction to the amount
of the Participant’s payments to provide for a survivor benefit upon death, but
only if the Beneficiary whose life was being used to determine the distribution
period described in Subsection 7.5(b) above dies and the payments continue
otherwise in accordance with that Section over the life of the
Participant;


 


(iii)                               to provide cash refunds of employee
contributions upon the Participant’s death; or


 


(iv)                              because of an increase in benefits under the
Plan.


 


(2)                                  If the annuity is a life annuity (or a life
annuity with a period certain not exceeding twenty (20) years), the amount
which must be distributed on or before the Participant’s Required Beginning
Date (or, in the case of distributions after the death of the Participant, the
date distributions are required to begin pursuant to section 7.5(d) below)
shall be the payment which is required for one payment interval. The second
payment need not be made until the end of the next payment interval even if
that payment interval ends in the next calendar year. Payment intervals are the
periods for which payments are received, e.g., bimonthly, monthly,
semi-annually, or annually.


 


If the annuity is a period
certain annuity without a life contingency (or is a life annuity with a period
certain exceeding twenty (20) years) periodic payments for each distribution
calendar year shall be combined and treated as an annual amount. The amount
which must be distributed by the Participant’s Required Beginning Date (or, in
the case of distributions after the death of the Participant, the date
distributions are


 


33

















 


required to begin pursuant to section 7.5(d) below) is the annual
amount for the first distribution calendar year. The annual amount for other
distribution calendar years, including the annual amount for the calendar year
in which the Participant’s Required Beginning Date (or the date distributions
are required to begin pursuant to Subsection 7.5(d) below) occurs, must be
distributed on or before December 31 of the calendar year for which the
distribution is required.


 


(3)                                  Annuities purchased after December 31,
1988, are subject to the following additional conditions:


 


(A)                              Unless the Participant’s Spouse is the
designated Beneficiary, if the Participant’s interest is being distributed in
the form of a period certain annuity without a life contingency, the period
certain as of the beginning of the first distribution calendar year may not
exceed the applicable period determined using the table set forth in Q&A
A-5 of Section 1.401(a)(9)-2 of the Proposed Income Tax Regulations.


 


(B)                                If the Participant’s interest is being
distributed in the form of a joint and survivor annuity for the joint lives of
the Participant and a Nonspouse Beneficiary, annuity payments to be made on or
after the Participant’s Required Beginning Date to the designated Beneficiary
after the Participant’s death must not at any time exceed the applicable
percentage of the annuity payment for such period that would have been payable
to the Participant using the table set forth in Q&A A-6
of Section 1.401(a)(9)-2 of the Proposed Treasury Regulations.


 


(4)                                  Transitional rule. If payments under an annuity which complies
with Subsection (1) above begin prior to January 1, 1989, the minimum
distribution requirements in effect as of July 27, 1987, shall apply to
distributions from this Plan, regardless of whether the annuity form of payment
is irrevocable. This transitional rule also applies to deferred annuity
contracts distributed to or owned by the Employee prior to January 1,
1989, unless additional contributions are made under the Plan by the Employer
with respect to such contract.


 


(5)                                  If the form of distribution is an annuity
made in accordance with this Subsection 7.5(c), any additional benefits
accruing to the Participant after his or her Required Beginning Date shall be
distributed as a separate and identifiable component of the annuity beginning
with the first payment interval ending in the calendar year immediately
following the calendar year in which such amount accrues.


 


(6)                                  Any part of the Participant’s interest which
is in the form of an individual account shall be distributed in a manner
satisfying the requirements of Section 401(a)(9) of the Code and the
proposed regulations thereunder.


 


34

















 


(d)                                 Death Distribution Provisions.


 


(1)                                  Distribution beginning before death. If the Participant dies after distribution
of his or her interest has begun, the remaining portion of such interest will
continue to be distributed at least as rapidly as under the method of
distribution being used prior to the Participant’s death.


 


(2)                                  Distribution beginning after death. If the Participant dies before distribution
of his or her interest begins, distribution of the Participant’s entire
interest shall be completed by December 31 of the calendar year containing
the fifth anniversary of the Participant’s death except to the extent that an
election is made to receive distributions in accordance with (A) or (B) below:


 


(A)                              if any portion of the Participant’s interest
is payable to a designated Beneficiary, distributions may be made over the life
or over a period certain not greater than the life expectancy of the designated
Beneficiary commencing on or before December 31 of the calendar year
immediately following the calendar year in which the Participant died;


 


(B)                                if the designated Beneficiary is the
Participant’s Surviving Spouse, the date distributions are required to begin in
accordance with (A) above shall not be earlier than the later of (1)
December 31 of the calendar year immediately following the calendar year
in which the Participant died or (2) December 31 of the calendar year in
which the Participant would have attained age 701/2.


 


If the Participant has not made an election
pursuant to this Subsection 7.5(d)(2) by the time of his or her death, the
Participant’s designated Beneficiary must elect the method of distribution no
later than the earlier of (1) December 31 of the calendar year in which
distributions would be required to begin under this Subsection, or (2)
December 31 of the calendar year which contains the fifth anniversary of
the date of death of the Participant. If the Participant has no designated
Beneficiary, or if the designated Beneficiary does not elect a method of
distribution, distribution of the Participant’s entire interest must be
completed by December 31 of the calendar year containing the fifth
anniversary of the Participant’s death.


 


(3)                                  For purposes of Subsection 7.5(d)(2)
above, if the Surviving Spouse dies after the Participant, but before payments
to such Spouse begin, the provisions of Section 7.5(d), with the exception
of paragraph (d)(2)(B) therein, shall be applied as if the Surviving Spouse
were the Participant.


 


(4)                                  For purposes of this Subsection 7.5(d),
any amount paid to a child of the Participant will be treated as if it had been
paid to the Surviving Spouse if


 


35

















 


the amount becomes payable to the Surviving Spouse when the child
reaches the age of majority.


 


(5)                                  For the purposes of this
Subsection 7.5(d), distribution of a Participant’s interest is considered
to begin on the Participant’s Required Beginning Date (or, if
Subsection 7.5(d)(3) above is applicable, the date distribution is
required to begin to the Surviving Spouse pursuant to Subsection 7.5(d)(2)
above). If distribution in the form of an annuity described in
Subsection 7.5(c)(l)) above irrevocably commences to the Participant
before the Required Beginning Date, the date distribution is considered to
begin is the date distribution actually commences.


 


(e)                                  Definitions.


 


(1)                                  Designated Beneficiary. The individual who is designated as the
Beneficiary under the Plan in accordance with Section 401(a)(9) of the
Code and the proposed Regulations thereunder.


 


(2)                                  Distribution Calendar Year. A calendar year for which a minimum
distribution is required. For distributions beginning before the Participant’s
death, the first Distribution Calendar Year is the calendar year immediately
preceding the calendar year which contains the Participant’s Required Beginning
Date. For distributions beginning after the Participant’s death, the first
Distribution Calendar Year is the calendar year in which distributions are
required to begin pursuant to Subsection 7.5(d) above.


 


(3)                                  Life expectancy. The life expectancy (or joint and last
survivor expectancy) is calculated using the attained age of the Participant
(or designated Beneficiary) as of the Participant’s (or designated
Beneficiary’s) birthday in the applicable calendar year. The applicable
calendar year shall be the first distribution calendar year.   If annuity payments commence before the
Required Beginning Date, the applicable calendar year is the year such payments
commence. Life expectancy and joint and last survivor expectancy are computed
by use of the expected return multiples in Tables V and VI of
Section 1.72-9 of the Treasury Regulations.


 


(A)                              The Required Beginning Date of a Participant
is the later of the April 1 of the calendar year following the calendar
year in which the Participant attains age 70 1/2  or retires except that benefit
distributions to a 5 percent (5%) owner must commence by the April 1 of
the calendar year following the calendar year in which the Participant attains
age 70 1/2.


 


(i)                                     any Participant (other than a 5 percent (5%)
owner) attaining age 70 1/2 during 1999 or 2000 may elect
by April 1 of the calendar year following the year in which the


 


36

















 


Participant attained age 70 1/2, to defer distributions until the
Participant retires. If no such election is made the Participant will begin
receiving distributions by the April 1 of the calendar year following the
calendar year in which the Participant attained age 70 1/2.


 


(ii)                                  the preretirement age 701/2
distribution option is eliminated with respect to Employees (other than 5
percent (5%) owners) who reach age 70 1/2 in or after the
calendar year that begins after December 31, 2000. The preretirement age
701/2 distribution option is an optional form of benefit
under which benefits payable in a particular distribution form (including any
modifications that may be elected after benefit commencement) commence at a
time during the period that begins on or after January 1 of the calendar
year in which an Employee attains age 701/2 and ends
April 1 of the immediately following calendar year.


 


(5)                                  5-percent (5%) owner.  A
Participant is treated as a 5-percent (5%) owner for purposes of this
Section if such Participant is a 5 percent (5%) owner as defined in
Section 416 of the Code at any time during the Plan Year ending with or
within the calendar year in which such owner attains age 701/2.


 


Once distributions have
begun to a 5-percent (5%) owner under this Section, they must continue to be
distributed, even if the Participant ceases to be a 5-percent (5%) owner in a
subsequent year.


 


(6)                                  Actuarial
Increase.  Except with respect to a
5-percent (5%) owner in other plans, a Participant’s Accrued Benefit is
actuarially increased to take into account the period after age 701/2 in which the Employee does not receive any
benefits under the Plan. The actuarial increase begins on the April 1
following the calendar year in which the Employee attains age 701/2 (January 1, 2000 in the case of an Employee
who attained age 701/2 during 1999), and ends
on the date on which benefits commence after retirement in an amount sufficient
to satisfy Section 401(a)(9) of the Code.


 


The amount of Actuarial
increase payable as of the end of the period for actuarial increases must be no
less than the Actuarial Equivalent of the Employee’s retirement benefits that
would have been payable as of the date the actuarial increase must commence
plus the Actuarial Equivalent of additional benefits accrued after that date,
reduced by the Actuarial Equivalent of any distributions made after that date.
The actuarial increase is generally the same as, and not in addition to, the
actuarial increase required for that same period under Section 411 of the
Code to reflect the delay in payments after Normal Retirement, except that the
actuarial increase required under Section 401(a)(9)(C) of the Code


 


37

















 


must be provided even during the period during which an Employee is in
Section 203(a)(3)(B) service.


 


For purposes of
Section 41l(b)(l)(H), of the Code the actuarial increase will be treated
as an adjustment attributable to the delay in distribution of benefits after
the attainment of Normal Retirement Age. Accordingly, to the extent permitted
under Section 411(b)(l)(H), the actuarial increase required under
Section 401(a)(9)(C)(iii) of the Code may reduce the benefit accrual
otherwise required under Section 41l(b)(l)(H)(i) of the Code, except that
the rules on the suspension of benefits are not applicable.


 


(f)                                    Transitional Rule.


 


(1)                                  Notwithstanding the other requirements of
this Section and subject to the requirements of Section 7.2,
distribution on behalf of any Employee, including a 5-percent (5%) owner, may
be made in accordance with all of the following requirements (regardless of
when such distribution commences):


 


(A)                              The distribution by the Plan is one which
would not have disqualified such Plan under Section 401(a)(9) of the Code
as in effect prior to amendment by the Deficit Reduction Act of 1984.


 


(B)                                The distribution is in accordance with a method
of distribution designated by the Employee whose interest in the Plan is being
distributed or, if the Employee is deceased, by a Beneficiary of such Employee.


 


(C)                                Such designation was in writing, was signed
by the Employee or the Beneficiary, and was made before January 1, 1984.


 


(D)                               The Employee had accrued a benefit under the
Plan as of December 31, 1983.


 


(E)                                 The method of distribution designated by the
Employee or the Beneficiary specifies the time at which distribution will
commence, the period over which distributions will be made, and in the case of
any distribution upon the Employee’s death, the Beneficiaries of the Employee
listed in order of priority.


 


(2)                                  A distribution upon death will not be covered
by this transitional rule unless the information in the designation contains
the required information described above with respect to the distributions to
be made upon the death of the Employee.


 


(3)                                  For any distribution which commences before
January 1, 1984, but continues after December 31, 1983, the Employee,
or the Beneficiary, to


 


38

















 


whom such distribution is being made, will be presumed to have
designated the method of distribution under which the distribution is being
made if the method of distribution was specified in writing and the
distribution satisfies the requirements in Subsections 7.5(f)(l)(A) and (E).


 


(4)                                  If a designation is revoked any subsequent
distribution must satisfy the requirements of Section 401(a)(9) of the
Code and the Proposed Treasury Regulations thereunder. If a designation is
revoked subsequent to the date distributions are required to begin, the Plan
must distribute by the end of the calendar year following the calendar year in
which the revocation occurs the total amount not yet distributed which would
have been required to have been distributed to satisfy Section 401(a)(9)
of the Code and the Proposed Treasury Regulations thereunder, but for the
Section 242(b)(2) election. For calendar years beginning after December 31,
1988, such distributions must meet the minimum distribution incidental benefit
requirements in Section 1.401(a)(9)-2 of the Proposed Treasury
Regulations. Any changes in the designation will be considered to be a
revocation of the designation. However, the mere substitution or addition of
another Beneficiary (one not named in the designation) under the designation
will not be considered to be a revocation of the designation, so long as such
substitution or addition does not alter the period over which distributions are
to be made under the designation, directly or indirectly (for example, by
altering the relevant measuring life). In the case in which an amount is
transferred or rolled over from one plan to another plan, the rules in Q&A
J-2 and Q&A J-3 of Section 1.401(a)(9)-l of the Proposed Treasury
Regulations shall apply.


 


(g)                                 Survivor Benefits.  Any
survivor benefits under this Article 7 shall be distributed at least as
rapidly as under the method of distribution being used prior to the Participant’s
death.


 


7.6                                 Direct
Rollover


 


(a)                                  General.  Notwithstanding any provision
of the Plan to the contrary that would otherwise limit a Distributee’s election
under this Section, but subject to such exceptions permitted by the Internal
Revenue Service, a Distributee may elect, at the time and in the manner
prescribed by the Plan Committee, to have any portion of an Eligible Rollover
Distribution paid directly to an Eligible Retirement Plan specified by the
Distributee in a Direct Rollover.


 


(b)                                 Definitions.


 


(1)                                  Eligible Rollover Distribution.  An
Eligible Rollover Distribution is any distribution of all or any portion of the
balance to the credit of the Distributee, except that an Eligible Rollover
Distribution does not include: any distribution that is one of a series of
substantially equal periodic payments (not less frequently than annually) made
for the life (or life expectancy) of the Distributee or the joint lives (or
joint life expectancies)


 


39

















 


of the Distributee and the Distributee’s designated Beneficiary, or for
a specified period of ten (10) years or more; any distribution to the extent
such distribution is required under Section 401(a)(9) of the Code; and the
portion of any distribution that is not includible in gross income (determined
without regard to the exclusion for net unrealized appreciation with respect to
Employer securities).


 


(2)                                  Eligible Retirement Plan.  An
Eligible Retirement Plan is an individual retirement account described in Section 408(a)
of the Code, an individual retirement annuity described in Section 408(b)
of the Code, an annuity plan described in Section 403(a) of the Code, or a
qualified trust described in Section 401(a) of the Code, that accepts the Distributee’s
Eligible Rollover Distribution. However, in the case of an Eligible Rollover
Distribution to the Surviving Spouse, an Eligible Retirement Plan is an
individual retirement account or individual retirement annuity.


 


(3)                                  Distributee.  A
Distributee includes an Employee or former Employee. In addition, the
Employee’s or former Employee’s Surviving Spouse and the Employee’s or former
Employee’s Spouse or former Spouse who is the alternate payee under a qualified
domestic relations order, as defined in section 414(p) of the Code, are
Distributees with regard to the interest of the Spouse or former Spouse.


 


(4)                                  Direct Rollover.  A
Direct Rollover is a payment by the Plan to the Eligible Retirement Plan
specified by the Distributee.


 


40

















 


ARTICLE 8


 


DEATH BENEFITS


 


8.1                                 Preretirement
Survivor Annuity.


 


(a)                                  General.  If a Participant dies before the
commencement of benefit payments, if he has a Surviving Spouse, and if he is
covered, under (b) below, by the Preretirement Survivor Annuity, then his
Surviving Spouse shall be entitled to the Preretirement Survivor Annuity.


 


(b)                                 Coverage.


 


(1)                                  The Preretirement
Survivor Annuity applies to any Participant who:


 


(A)                              has
at least one (1) Hour of Service or at least one (1) hour of paid leave from
the Employer (or any other employer for whom service is treated as service for
the Employer) on or after August 23, 1984;


 


(B)                                has
a nonforfeitable right to any portion of his Accrued Benefit;


 


(C)                                who
has a Surviving Spouse who survives to commencement of the Preretirement
Survivor Annuity under (d) below.


 


(2)                                  Entitlement
Under Provisions of Champion Plan Prior to May 14, 1999.  The Preretirement Survivor Annuity
provisions in effect prior to May 14, 1999 that apply to any Transferred
Employees are as provided in the attached Addendum to the Plan.
(Article 8, Entitlement under the Provision of Champion Plan Prior to May
14, 1999).


 


(c)                                  Definition of Preretirement Survivor Annuity.  The
Preretirement Survivor Annuity is a survivor annuity for the life of a
Participant’s Surviving Spouse:


 


(1)                                  under
which the payments are equal to the survivor annuity which would have been paid
under the Qualified Joint and Survivor Annuity (with a survivor annuity equal
to fifty percent (50%) of the amount of annuity which is payable during their
joint lives) if:


 


(A)                              in
the case of a Participant who dies after attaining his Earliest Retirement Age,
such Participant had retired with an immediate Qualified Joint and Survivor
Annuity on the day before his death; or


 


(B)                                in the case of a
Participant who dies on or before attaining his


 


41

















 


Earliest Retirement Age, such Participant had


 


(i)                                     separated from service on the earlier of his
actual separation or the date of his death,


 


(ii)                                  survived to his Earliest Retirement Age,


 


(iii)                               begun to receive his benefit under the Plan
as an immediate Qualified Joint and Survivor Annuity at his Earliest Retirement
Age, and


 


(iv)                              died on the day after the day on which he
would have attained his Earliest Retirement Age.


 


(2)                                  under which annuity payments commence as of
the later of:


 


(A)                              the Participant’s date of death; or


 


(B)                                the date on which the Participant would have
attained his Earliest Retirement Age.


 


(d)                                 Preretirement Survivor Annuity Commencement
Date.  The Preretirement Survivor Annuity shall
commence as of the latest of:


 


(1)                                  the first day of the month coinciding with or
next following the Participant’s date of death;


 


(2)                                  the date on which the Participant would have
attained his Earliest Retirement Age; or


 


(3)                                  the first day of the month (not later than
the December 31st of the calendar year in which the Participant would have
attained age 70 1/2) elected by such Surviving Spouse.


 


If the Preretirement
Survivor Annuity commences as of a date other than the applicable date under
(d)(2) above, the amount of the benefit shall be actuarially adjusted in
accordance with the actuarial assumptions set forth in Section 2.3 to
account for the different commencement date.


 


(e)                                  Cash Out Distributions.  Any
other provisions of the Plan to the contrary notwithstanding, the lump sum
Actuarial Equivalent of the Preretirement Survivor Annuity shall be distributed
to the Surviving Spouse, provided that the Actuarial Equivalent (determined as
of the date on which distribution occurs) of such Preretirement Survivor
Annuity does not exceed $5,000 and such payment is made before payment
otherwise begins.


 


42

















 


8.2                                 Optional Survivor Benefit After Normal Retirement
Age.


 


(a)                                  Entitlement.  An
Optional Survivor Benefit shall be paid in the case of a Participant who dies
after attaining his Normal Retirement Age but before his Benefit Commencement
Date if:


 


(1)                                  no amount is payable under Section 8.1,
relating to the Preretirement Survivor Annuity, and


 


(2)                                  the Participant has made an effective
election, under Section 7.3, of an optional form of retirement benefit
which provides a survivor benefit.


 


(b)                                     Amount and Form.  The
survivor benefit payable pursuant to (a) above shall be the same survivor
benefit provided under the applicable optional form, computed as of the first
day of the month coinciding with or next following the Participant’s death and
as if the Participant had retired on the day before his death and without
regard to any requirement that the Participant survive to his Benefit
Commencement Date.


 


(c)                                      Distribution Periods. 
Death benefits under (b) above shall be distributed to a Participant’s
Beneficiary:


 


(1)                                  no later than December 31 of the calendar
year containing the fifth anniversary of the Participant’s death; or


 


(2)                                  if the Beneficiary has been designated by the
Participant:


 


(A)                              beginning no later than December 31 of
the calendar year immediately following the calendar year of the Participant’s
death; if the designated Beneficiary is the Participant’s Spouse, not later
than the December 31 of the calendar year in which the Participant would
have attained age 701/2, and if such Spouse dies before
payments are required to commence, then the distribution period hereunder shall
be determined as if such Spouse were the Participant) and


 


(B)                                over a period not extending beyond the life
expectancy of such Beneficiary.


 


(d)                              Minimum Distribution.


 


(1)                                  General.  Subject to Section 7.5
and subject to such transitional rules as may be provided in Treasury
Regulations, if distributions are to be made under (c)(2) above, then minimum
distributions are required to be made in accordance with this
Subsection (d). In all events, installment payments must be paid in
periodic payments made at payment intervals not longer


 


43

















 


than one year over a period or periods not longer than those described
in (c)(2)(B) above, and once payment has commenced the distribution period may
not be lengthened.


 


(2)                                  Time for Payments.  If
the form of payment under the Plan is installment payments for a fixed number
of years, the first calendar year for which distributions are required is the
calendar year in which the Participant dies or the Spouse dies (whichever is
applicable). The distribution for the first calendar year for which
distributions are required shall be made on or before the applicable
December 31 determined under (c)(2) above. The amount which must be
distributed for the first calendar year and subsequent calendar years is an
annual amount equal to the aggregate of the periodic payments for a calendar
year otherwise payable under the particular form of benefit. The minimum
distribution for succeeding calendar years shall be made on or before
December 31 of each such year.


 


(3)                                            Life Expectancy.


 


(A)                              General.  For purposes of this
Section 8.2, life expectancy will be computed in accordance with
applicable Treasury Regulations under Section 401(a)(9) of the Code and by
the use of the return multiples contained in Tables V and VI of Treasury
Regulation Section 1.72-9 and, except as provided in (4) below, will be
determined as of the Beneficiary’s birthday in the calendar year in which
distributions are required to commence under (c)(2)(B) above.


 


(B)                                No Recalculation.  The
life expectancy of a Beneficiary, once determined under (A) above, may not
subsequently be recalculated.


 


(4)                                  Separate Accounts or Segregated Shares.  If a
Participant has a separate account or other benefit under the Plan which may be
separately distributed, the minimum distributions shall be determined in
accordance with applicable Treasury Regulations under Section 401(a)(9) of
the Code.


 


8.3                                 Post-Retirement Death Benefit.


 


(a)                                  Entitlement.  Upon
the death of a Participant after his retirement, if he was a Salaried Employee
at the time of his retirement and if he retired pursuant to Section 6.1,
6.2 or 6.3, then his Beneficiary shall be entitled to the Post-Retirement Death
Benefit; provided the Committee had not caused the Actuarial Equivalent thereof
to be paid to such Participant upon his retirement. The Committee shall cause
the Actuarial Equivalent of the Post-Retirement Death Benefit to be paid to a
Participant upon his retirement only if such Participant otherwise receives a
single cash payment under Section 7.4(d) or 9.1.


 


44

















 


(b)                                 Definition of Post-Retirement Death Benefit.


 


(1)                                  Retirement Prior to Age 62. 
Except as provided in (3) and (4) below, the Post-Retirement Death
Benefit with respect to a Participant who retires on or after January 1,
1982 and prior to attaining age sixty-two (62), shall be $5,000.00.


 


(2)                                  Retirement on or After Age 62. 
Except as provided in (3) and (4) below, the Post-Retirement Death
Benefit with respect to a Participant who retires on or after January 1,
1982 and on or after attaining age sixty-two (62) shall be $5,000.00 or if he
dies within the first five (5) years of retirement, the greater of:


 


(A)                              $5,000.00, or


 


(B)                                the following percentage of his Average
Earnings:


 


one hundred percent (100%), if he dies in the first year of retirement;


 


eighty percent (80%), if he dies in the second year of retirement;


 


sixty percent (60%), if he dies in the third year of retirement;


 


forty percent (40%), if he dies in the fourth year of retirement;


 


twenty percent (20%), if he dies in the fifth year of retirement.


 


For the purposes of the
above schedule, a Participant who retires after his Normal Retirement Date
shall be deemed to have retired on his Normal Retirement Date.


 


(3)                                  Transferred Employees.  The
Post-Retirement Death Benefit with respect to a Transferred Employee who is a
Participant in the Plan and who was a former St. Regis Employee shall be as
provided in the Addendum to the Plan (Article 8, Former St. Regis
Employees).


 


(4)                                  Offset Provision. 
Notwithstanding any provision in (1), (2), or (3) above to the contrary,
effective with respect to any Post-Retirement Death Benefit payable under this
Section 8.3 to a Transferred Employee such benefit shall be offset by any
death benefit payable with respect to such Participant from the Champion
International Corporation Executive Insurance Plan #700.


 


(c)                                  Form of Payment.  The
Post-Retirement Death Benefit shall be payable in such form as elected by such
payee, which form shall be a lump sum, in installments, or any combination of
the foregoing.


 


45

















 


(d)                                 Distribution Periods. 
Post-Retirement Death Benefits under (a) above shall be distributed to a
Participant’s Beneficiary:


 


(1)                                  no later than December 31 of the
calendar year containing the fifth anniversary of the Participant’s death; or


 


(2)                                  if the Beneficiary has been designated by the
Participant:


 


(A)                              beginning not later than December 31 or
the calendar year immediately following the calendar year of the Participant’s
death (or, if the designated Beneficiary is the Participant’s Spouse, not later
than the December 31 of the calendar year in which the Participant would
have attained age 701/2,
and if such Spouse dies before payments are required to commence,
then the distribution period hereunder shall be determined as if such Spouse
were the Participant); and


 


(B)                                over a period not extending beyond the life
expectancy of such Beneficiary.


 


(e)                                  Minimum Distribution.


 


(1)                                  General.  Subject to Section 7.5,
for Plan Years beginning after December 31, 1984, subject to such
transitional rules as may be provided in Treasury Regulations, if distributions
are to be made under (d)(2) above, then Minimum Distributions are required to
be made in accordance with this Subsection (e). In all events, installment
payments must be paid in periodic payments made at payment intervals not longer
than one year over a period or periods not longer than those described in
(d)(2)(B) above, and once payment has commenced the distribution period may not
be lengthened.


 


(2)                                  Time for Payments.  If
the form of payment under the Plan is installment payments for a fixed number
of years, the first calendar year for which distributions are required is the
calendar year in which the Participant dies or the Spouse dies (whichever is
applicable). The distribution for the first calendar year for which
distributions are required shall be made on or before the applicable December 31
determined under (d)(2) above. The amount which must be distributed for the
first calendar year and subsequent calendar years is an annual amount equal to
the aggregate of the periodic payments for a calendar year otherwise payable
under the particular form of benefit. The minimum distribution for succeeding
calendar years shall be made on or before December 31 of each such year.


 


46

















 


(3)                                  Life Expectancy.


 


(A)                              General. For purposes of this Section 8.4, life expectancy will be
computed in accordance with applicable Treasury Regulations under
Section 401(a)(9) of the Code and by the use of the return multiples
contained in Tables V and VI of Treasury Regulation Section 1.72-9 and,
except as provided in (4) below, will be determined as of the Beneficiary’s
birthday in the calendar year in which distributions are required to commence
under (b)(2)(B) above.


 


(B)                                No Recalculation. The life expectancy of a Beneficiary, once
determined under (A) above, may not subsequently be recalculated.


 


(4)                                  Separate Accounts or Segregated Shares. If a Participant has a separate account or
other benefit under the Plan which may be separately distributed, the minimum
distributions shall be determined in accordance with applicable Treasury
Regulations under Section 401(a)(9) of the Code.


 


47

















 


ARTICLE 9


 


PAYMENT EXCEPTIONS


 


9.1                                 Small Benefit. Any provisions of the Plan to the contrary
notwithstanding, the Committee shall direct the payment of a benefit where the
monthly installment thereof is less than $50.00 to be paid: in advance, in
quarterly, semiannual, or annual installments; or, subject to
Section 7.4(d), by a single cash payment.


 


9.2                                 Transitional Rule.


 


(a)                                  General. Anything in the Plan (other than the provisions relating to the
Qualified Joint and Survivor Annuity and the Preretirement Survivor Annuity) to
the contrary notwithstanding, distribution on behalf of any Participant may be
made in accordance with the following requirements (regardless of when such
distribution commences):


 


(1)                                  the distribution is one which would not have
disqualified the Plan under Section 401(a)(9) of the Code as in effect
prior to amendment by the Deficit Reduction Act of 1984;


 


(2)                                  the distribution is in accordance with a
method of distribution designated by the Participant whose interest is being
distributed or, if the Participant is deceased, by a Beneficiary of such
Participant;


 


(3)                                  such designation was in writing, was signed
by the Participant or Beneficiary, and was made before January 1, 1984;


 


(4)                                  the Participant had accrued a benefit under
the Plan as of December 31, 1983; and


 


(5)                                  the method of distribution designated by the
Participant or the Beneficiary specifies the form of the distribution, the time
at which distribution will commence, the period over which distributions will
be made, and in the case of any distribution upon the Participant’s death, the
Beneficiaries of the Participant listed in order of priority.


 


(b)                                 Distributions Upon Death. A distribution upon death will not be
covered by this transitional rule unless the information in the designation
contains the required information described above with respect to the
distributions to be made upon the death of the Participant.


 


(c)                                  Effect of Revocation. If a designation is revoked, the subsequent
distribution must satisfy the requirements of Section 401(a)(9) of the
Code as in effect at the time. Any changes in the designation will be
considered to be a revocation of the designation; provided, however, the mere
substitution or addition of another Beneficiary (one not named in the
designation) under the designation will not be considered to be a revocation of
the designation so long as such substitution or addition does not alter the designation,
directly or indirectly (for example, by altering the relevant measuring life).


 


48

















 


ARTICLE 10


 


LIMITATIONS ON BENEFITS


 


10.1                           Definitions. For purposes of this Article 10, the
following terms shall have the following meanings:


 


(a)                                  “Annual Addition” means, with respect
to all Defined Contribution Plans in which a Participant participates or has
participated, the sum, for the Limitation Year, of:


 


(1)                                  all employer contributions (other than
amounts restored in accordance with Section 41l(a)(3)(D) or 41l(a)(7)(C)
of the Code) allocated to his account;


 


(2)                                  all forfeitures allocated to his account;


 


(3)                                  the amount of his own such contributions for
the Limitation Year provided that such contributions for years prior to 1987
which were disregarded under the Plan then in effect shall continue to be
disregarded; and


 


(4)                                  all contributions allocated on the
Participant’s behalf to any individual medical account as defined in
Section 415(1) (2) of the Code, which is part of a pension or annuity plan
maintained by the Employer or an Affiliate. A Participant’s Annual Addition
shall not include amounts set forth in (4) for purposes of determining the
Compensation Limitation set forth in 10.1(c). A Participant’s Annual Addition
shall include such other amounts as the Commissioner of Internal Revenue
properly determines. An Annual Addition shall be deemed credited to a
Participant’s account with respect to an applicable Limitation Year if it is
allocated to his account under the terms of such plan as of any date within
such applicable Limitation Year; provided however, such amount must be actually
contributed within the time limit prescribed by applicable Treasury
Regulations.


 


(b)                                    “Annual Benefit” means, with respect to
a Participant, his annual benefit in the form of a straight life annuity under
the Plan and any other Defined Benefit Plans in which he participates or has
participated, but not including any benefits not directly related to retirement
benefits or any benefits attributable to employee contributions, rollover
contributions, or (to the extent provided by applicable Treasury regulations)
amounts transferred directly from another plan. Any benefit under any multi
employer plan (as defined in Section 414(f) of the Code) shall be included
only to the extent of the excess of such benefit over the benefit computed as
if the Participant had no covered service with the Employer or any Affiliate.


 


(c)                                     “Compensation” means wages within the
meaning of Section 3401(a) of the Code for the purpose of income tax
withholding at the source but determined without regard to any rule that limits
the renumeration included in wages based on the nature or location of


 


49

















 


employment or services performed. Compensation shall include any
elective deferral, as defined in Section 402(g)(3) of the Code, and any
amount contributed or deferred by the Employer at the Employee’s election that
is not includible in the Employee’s gross income under Section 125 or 457
of the Code.


 


(d)                                 “Defined Benefit Plan” means a plan
(whether or not terminated) of the Employer or an Affiliate that is not a
Defined Contribution Plan and that either qualifies under Section 401 of
the Code or meets the requirements of Section 404(a)(2) of the Code.


 


(e)                                  “Defined Benefit Plan Fraction,” with
respect to a Participant, means, subject to Section 2004(d)(2) of ERISA, a
fraction:


 


(1)                                  the numerator of which is the sum, for all
Defined Benefit Plans in which he participates or has participated, of his
Projected Annual Benefit (as determined under Section 415(b)(2) of the
Code as of the close of the Limitation Year), and


 


(2)                                  the denominator of which is the lesser of:


 


(A)                              125 percent (125%) times the dollar
limitation, under Sections 415(b)(l)(A) and (d) of the Code, in effect for the
Limitation Year, or


 


(B)                                140 percent (140%) times the Participant’s
average Compensation for his highest three (3) consecutive Limitation Years
(including any adjustments under Section 415(b)(5) of the Code).
Notwithstanding the above, if the Participant was a Participant as of the first
day of the first Limitation Year beginning after December 31, 1986, in one
or more Defined Benefit Plans maintained by the Employer which were in existence
on May 6, 1986, the denominator of this fraction will not be less than 125
percent (125%) of the sum of the annual benefits under such plans which the
Participant had accrued as of the end of the last Limitation Year beginning
before January 1, 1987, disregarding any changes in the terms and
conditions of the plan after May 5, 1986. The preceding sentence applies only
if the Defined Benefit Plans individually and in the aggregate satisfied the
requirements of Section 415 of the Code for all Limitation Years beginning
before January 1, 1987.


 


(f)                                    “Defined Contribution Plan” means each
of the following (whether or not terminated) maintained by the Employer or an
Affiliate:


 


(1)                                  a plan that is qualified under
Section 401 of the Code and that provides for an individual account for
each participant and for benefits based solely on the amount contributed to the
participant’s account, and any income, expenses, gains and losses, and any
forfeitures of accounts of other participants which may be allocated to such
participant’s account;


 


50

















 


(2)                                  a Participant’s contributions to a Defined
Benefit Plan;


 


(3)                                  contributions by the Employer or an Affiliate
to a simplified employee pension (as defined in Section 408(k) of the Code);


 


(4)                                  amounts allocated, in years beginning after
March 31, 1984, to an individual medical benefit account, as defined in
Section 415(1)(2) of the Code, which is part of a Defined Benefit Plan;
and


 


(5)                                  a welfare benefits-fund, as defined in
Section 419(e) of the Code, maintained by the Employer or an Affiliate,
with respect to amounts derived from contributions paid or accrued after
December 31, 1985, in taxable years ending after such date, which are
attributable to post-retirement medical benefits allocated to the separate
account of a key employee, as defined in Section 419A(d)(3) of the Code.


 


(g)                                 “Defined Contribution Plan Fraction,”
with respect to a Participant, means, subject to the transition rules under
Section 415(e) of the Code and subject to the special rules provided by
Treasury regulations for special situations (including situations in which past
records are not available), a fraction:


 


(1)                                  the numerator of which is the sum of the
Annual Addition to the Participant’s account for the current Limitation Year
and all prior Limitation Years and


 


(2)                                  the denominator of which is the sum of the
defined contribution denominator increments for the current and all prior
Limitation Years of the Participant’s service with the Employer (regardless of
whether the defined contribution plan was maintained during those years). For
each Limitation year, the defined contribution denominator increment is the
lesser of the following amounts:


 


(A)                              125 percent (125%) of the dollar limitation
in effect under Section 415(c)(l)(A) of the Code after adjustments under
Section 415(d) of the Code, or


 


(B)                                35 percent (35%)of the Participant’s
compensation for such year.


 


If the Participant was a
Participant as of the first day of the first Limitation Year beginning after December 31,
1986, in one or more Defined Contribution Plans which were maintained by the
Employer and were in existence on May 6, 1986, the numerator of this fraction
will be adjusted if the sum of this fraction and the Defined Benefit Plan
Fraction would otherwise exceed 1.0 under the terms of this Plan. Under the
adjustment, an amount equal to the product of the excess of the sum of the
fractions over 1.0 times the denominator of this fraction, will be permanently
subtracted from the numerator of this fraction. The adjustment is calculated
using the fractions as they would be computed as of the end of the last
Limitation Year beginning before January 1, 1987 and disregarding any
changes in the terms and conditions of the plan made after May 6, 1986, but using
the


 


51

















 


Section 415 limitation applicable to the first Limitation Year
beginning on or after January 1, 1987. The Annual Additions for any
Limitation Year shall not be recomputed to treat all nondeductible
contributions as Annual Additions.


 


(h)                                 “Limitation Year” means the calendar
year or any other twelve (12)consecutive-month period adopted pursuant to
written resolution.


 


(i)                                     “Projected Annual Benefit” means, in
the case of a Defined Benefit Plan, the Annual Benefit to which a Participant
would benefit upon the assumptions that:


 


(1)                                  he will continue employment until reaching
normal retirement age as determined under the terms of the Plan (or current
age, if that is later);


 


(2)                                  his Compensation for the Limitation Year
under consideration will remain the same until the date he attains the age
described in (1) above; and


 


(3)                                  all other relevant factors used to determine
benefits under the Plan for the Limitation Year under consideration will remain
constant for all future Limitation Years.


 


(j)                                     “Social Security Retirement Age” means
the age used as the retirement age for the Participant under
Section 216(1) of the Social Security Act, except that such
Section shall be applied:


 


(1)                                  without regard to the age increase factor;
and


 


(2)                                  as if the early retirement age under
Section 216(1)(2) of such Act were 62.


 


10.2                           Limitation on Benefits.


 


(a)                                  General. Anything in any other Article of the Plan to the contrary
notwithstanding, a Participant’s Annual Benefit shall not, at any time within
any Limitation Year to which Section 415 of the Code applies, exceed the
lesser of:


 


(1)                                  $90,000 (as adjusted pursuant to
Section 415(d) of the Code, or


 


(2)                                  100 percent (100%) of his average
Compensation for the three (3) consecutive Limitation Years for which he had
the greatest aggregate Compensation. If the benefit a Participant otherwise
would accrue in a Limitation Year would exceed the maximum Annual Benefit, the
rate of accrual shall be reduced to equal the maximum Annual Benefit.


 


(b)                                 Participation in More Than One Defined
Benefit Plan. If a
Participant participates, or has participated, in more than one Defined Benefit
Plan, then any required reduction in his Annual Benefit shall be effected by
reducing the most recently Accrued Benefit (other than a benefit under a multi
employer plan as defined in Section 414(f) of the Code); and if such
benefits accrued simultaneously under more than one plan, any such reduction
shall be applied to each such benefit in proportion to the amount of such
benefit (determined without regard to the limitations under Section 415 of
the Code).


 


52

















 


(c)                                  Cost-of-Living Adjustments. The dollar limitation set forth in (a)(l)
above and, in the case of a Participant who separated from service, both the
dollar limitation in (a)(1) and the amount taken into account under (a)(2)
shall be adjusted for increases in the cost of living as prescribed by the
Secretary of the Treasury. Such limitations as adjusted shall apply both before
and after the Participant’s Benefit Commencement Date. A Participant whose
benefit payments have commenced shall have future payments adjusted to reflect
the increased limits, but in no event shall his benefit payments exceed the
amount that would be payable without regard to the provisions of this
Section 10.2. Any adjustments hereunder shall apply with respect to
Limitation Years ending with or within the calendar year for which such
adjustment is effective. No such adjustment shall be made to the dollar
limitation in (a)(l) with respect to any Limitation Year beginning before
January 1, 1988.


 


(d)                                 Actuarial Adjustments.


 


(1)                                  Adjustment for Form of Payment. If a Participant’s benefit is in any form
other than a straight life annuity, then, for purposes of (a) above, such
benefit shall be adjusted to an actuarially equivalent straight life annuity in
accordance with rules determined by the Commissioner of Internal Revenue;
provided however, the value of a qualified joint and survivor annuity (as
defined in Section 417 of the Code) shall not be taken into account to the
extent that such value exceeds the sum of the value of a straight life annuity
beginning on the same date and the value of any post-retirement death benefits which
would be payable even if the annuity were not in the form of a joint and
survivor annuity.


 


(2)                                  Adjustments for Benefits Beginning Before
Social Security Retirement Age and on After Age 62. If a Participant’s retirement benefit begins
before Social Security Retirement Age, but on or after age sixty-two (62), then
the dollar amount limitation under (a)(l) above shall be adjusted as follows:


 


(A)                              Social Security Retirement Age is 65. If the Participant’s Social Security Age is
65, the limitation under (a)(l) above is reduced by 5/9 of one percent for each
month by which benefits commence before the month in which the Participant
attains age sixty-five (65).


 


(B)                                Social Security Retirement Age Greater than
65. If the Participant’s
Social Security Retirement Age is greater than sixty-five (65), the limitation
under (a)(l) above is reduced by 5/9 of one percent for each of the first
thirty-six (36) months and 5/12 of one percent for each additional month (up to
24 months) by which benefits commence before the month of the Participant’s
Social Security Retirement Age.


 


(3)                                  Adjustment for Benefit Beginning Prior to Age
62. If a Participant’s
retirement benefit begins before age sixty-two (62), the dollar amount
limitation under (a)(l) above, shall first be reduced under (d)(2) above as


 


53

















 


if benefits commenced at age 62 and then further adjusted, in
accordance with rules determined by the Commissioner of Internal Revenue, so
that it is the actuarial equivalent of such an amount beginning at age
sixty-two (62).


 


(4)                                  Adjustment for Benefit Beginning After Social
Security Retirement Age.  If a Participant’s retirement benefit begins
after Social Security Retirement Age, then the dollar amount limitation under
(a)(l) above shall be adjusted, in accordance with rules determined by the
Commissioner of Internal Revenue, so that it is the actuarial equivalent of
such an amount beginning at Social Security Retirement Age.


 


(5)                                  Interest Rate Assumptions.


 


(A)                              Adjustments For Form of Payment and For
Benefits Before Social Security Retirement Age.  For
purposes of adjusting any benefit or limitation under (1), (2) and (3) above,
the interest rate assumption shall be the greater of five percent (5%) and the
rate used for purposes of Section 2.3.


 


(B)                                Adjustment For Benefit After Social Security
Retirement Age. For purposes
of adjusting any limitation under (4) above, the interest rate assumption shall
be the lesser of five percent (5%) and the rate used for purposes of
Section 2.3.


 


(e)                                  Total Annual Benefits Not In Excess of
$10.000. Anything in (a)
above to the contrary notwithstanding, the benefits payable with respect to a
Participant under the Plan shall be deemed not to exceed the limitations of
this Section 10.2 if:


 


(1)                                  the retirement benefits (without adjustment
under (d) above) payable with respect to such Participant under the Plan and
under all other Defined Benefit Plans ever maintained by the Employer do not
exceed $10,000 for the Limitation Year or any prior Limitation Year; and


 


(2)                                  the Participant has never, at any time,
participated in a Defined Contribution Plan maintained by the Employer to the
extent defined in Section 10.1(f)(l).


 


(f)                                    Reduction for Less Than 10 Years of
Participation or Service.


 


(1)                                  Dollar Limitation. In the case of a Participant who has less
than ten (10) years of service (determined on a reasonable and consistent
basis) with the Employer and any Affiliates, the limitations in (a)(2) and (e)
above shall be modified by multiplying each such limitation by a fraction, the
numerator of which is the number of his years of participation (or part
thereof) and the denominator of which is ten (10); provided however, such
limitation shall not be reduced to an amount less than one tenth (1/10) of such
limitation (determined without regard to this paragraph). To the


 


54

















 


extent provided in Treasury Regulations, this limitation shall be
applied separately with respect to each change in the benefit structure of the
Plan.


 


(2)                                  Compensation and Benefits Limitations. In the case of a Participant who has less
than ten (10) years of service (determined on a reasonable and consistent
basis) with the Employer and any Affiliates, the limitations in (a)(2) and (e)
above shall be modified by multiplying each such limitation by a fraction, the
numerator of which is the number of his years of service (or part thereof) and
the denominator of which is ten (10); provided however, such limitations shall
not be reduced to amounts less than one tenth (1/10) of such limitations
(determined without regard to this paragraph).


 


(g)                                 Pre-TRA 1986 Accrued Benefit. For a Transferred Employee the limitations
under the Section 10.2 above shall not be less than a Participant’s
Accrued Benefit, determined under the Champion Plan as in effect on May 13,
1999 as of the close of the last Limitation Year beginning before
January 1, 1987 but without regard to changes in the Plan after May 5,
1986 and without regard to cost of living increases occurring after May 5,
1986.


 


(h)                                 Pre-TEFRA Accrued Benefit. For a Transferred Employee the limitations
under (a) above shall not be less than a Participant’s Accrued Benefit or
Normal Retirement Benefit, as the case may be (expressed as an Annual Benefit),
determined under the Champion Plan as in effect on May 13, 1999 as of the close
of the last Limitation Year beginning before January 1, 1983 but without
regard to changes in the Plan and cost of living increases occurring after
July 1, 1982.


 


(i)                                     Special Rules. The limitations contained in this
Section shall be subject to Section 10.4, subject to the transition
rule under Section 2004(d)(2) of ERISA (applicable to an individual who
was an active Participant before October 3, 1973), and subject to Treasury
regulations covering the aggregation during a Limitation Year of previously
unaggregated plans.


 


10.3                           Limitation on Participant Contributions.


 


(a)                                  Limitation. Anything in any other Article of the Plan to the contrary
notwithstanding, no Participant contributions may be allocated to a
Participant’s account under the Plan if the Annual Addition with respect to
such Participant would exceed the lesser of (1) $30,000 (or such larger amount
as may be prescribed by the Secretary of the Treasury, determined as of the
last day of the applicable Limitation Year) or (2) 25 percent (25%) of his
Compensation for the Limitation Year.


 


(b)                                 Treatment of Excess Contributions. If, as a result of a reasonable error in
estimating a Participant’s annual Compensation, or under other facts and
circumstances which the Commissioner of Internal Revenue finds justify the
availability of the rules set forth herein, the limitations of (a) above are
exceeded, then employee contributions together with any gains allocated thereto
shall be returned to the extent that the return would reduce the excess amount.


 


55

















 


(c)                                  Allocation of Excess Among Plans. If amounts are allocated to a Participant’s
account under more than one Defined Contribution Plan, then any excess shall be
deemed to consist of the amounts last allocated. If amounts are allocated under
more than one Defined Contribution Plan as of the same date, then the excess
attributed to each such plan shall be the same proportion of the total excess as
the ratio of the amount allocated to the Participant as of such date under such
plan divided by the total amount allocated as of such date (determined without
regard to the limitations under section 415 of the Code); provided
however, no excess shall be attributed to an employee stock ownership plan
within the meaning of Section 4975(e)(7) of the Code until the Annual
Additions under all other Defined Contribution Plans.


 


(d)                                 Participant in an Employee Stock Ownership
Plan. In the case of a
Participant who is a participant in a Defined Contribution Plan which is either
an employee stock ownership plan within the meaning of Section 4975(e)(7)
of the Code or a tax credit employee stock ownership plan within the meaning of
Section 409 of the Code, the dollar limitation under (a) (1) above shall
be equal to $30,000 (or such larger amount as may be prescribed by the
Secretary of the Treasury, determined as of the last day of the applicable
Limitation Year) plus (for Plan Years beginning prior to January 1, 1990)
the lesser of (1) $30,000 (as adjusted) or (2) the Employer’s contribution of
both principal and interest to repay an exempt loan described in
Section 4975(d)(3) of the Code, or the amount of Employer securities
contributed (or purchased with cash contributed) to such plan in respect of the
applicable Limitation Year. The preceding sentence shall be subject to
applicable Treasury Regulations and shall apply only if not more than one-third
of the Employer contributions to such plan in respect of the applicable
Limitation Year are allocated to Participants who are highly compensated
employees within the meaning of Section 414(q) of the Code, or whose total
Compensation for such Limitation Year exceeds twice the $30,000 limitation as
adjusted.


 


(e)                                  Special Rules. The limitations contained in this
Section shall be subject to Section 10.4 and subject to Treasury
Regulations covering the aggregation during a Limitation Year of previously
unaggregated plans.


 


10.4                           Limitation in Case of Defined Benefit Plan
and Defined Contribution Plan for the Same Employee For Limitation Years
Beginning Prior to January 1, 2000. In any case in which a Participant has at any time participated in one
or more Defined Contribution Plans for Limitation Years beginning prior to
January 1, 2000, the sum of the Defined Benefit Plan Fraction and the
Defined Contribution Plan Fraction, for any Limitation Year to which
Section 415 of the Code applies, may not exceed 1.0, subject to the
provisions of Section 2004(a)(3) of ERISA (applicable to an individual
who, on September 2, 1974, was a Participant in both a Defined Benefit
Plan and a Defined Contribution Plan), and subject to Treasury Regulations
covering the aggregation during a Limitation Year of previously unaggregated
plans. If such sum would exceed 1.0, then Annual Additions attributable to
Participant contributions shall be reduced (pursuant to Section 10.3) to
the extent necessary to eliminate such excess; and, if such excess is not
eliminated thereby, then the rate of benefit accrual under the Plan shall be
frozen or reduced (pursuant to Section 10.2(b) in the case of a
Participant who participates in more than one Defined Benefit Plan) to the
extent necessary to eliminate such excess.


 


56

















 


10.5                          Adjustment of Defined Contribution Fraction. If the defined benefit plans and the defined
contribution plans taken into account in determining the limitation described
in Section 10.4 for Limitation Years beginning prior to January 1,
2000 meet the requirements of Section 415 of the Code as in effect for the
last Limitation Year beginning before January 1, 1987, an amount shall be
subtracted from the numerator of the Defined Contribution Plan Fraction,
according to rules prescribed by the Secretary of the Treasury, so that the sum
of the Defined Benefit Plan Fraction and Defined Contribution Plan Fraction
computed under Section 415(e)(l) of the Code does not exceed 1.0 at the
commencement of the Plan Year beginning January 1, 1987.


 


57

















 


ARTICLE 11


 


RESTRICTIONS ON BENEFITS


 


Restrictions.


 


(a)                                  Effective Date. The provisions of this Section shall be
applicable to Plan Years beginning on or after January 1, 1992.


 


(b)                                 Restriction on Benefits. Any other provision of the Plan to the
contrary notwithstanding the benefit of any highly compensated employee (as
defined in Section 414(q) of the Code) and any highly compensated former
employee (as defined in Section 414(q)(9) of the Code) is limited to a
benefit that is nondiscriminatory under Section 401(a)(4) of the Code.


 


(c)                                  Restrictions on Distributions.


 


(1)                                  Applicability. The restrictions described in (2) below are
applicable only if:


 


(A)                              after payment to a Restricted Participant of
all Benefits to which he is entitled, the value of Plan Assets does not equal
or exceed 110 percent (110%) of current liabilities, as defined in
Section 412(1)(7) of the Code, and


 


(B)                                the value of Benefits of a Restricted
Participant is not less than one percent (1%) of the value of current
liabilities before distribution.


 


(2)                                  Limit on Annual Payments. The annual payments to a Restricted
Participant are restricted to an amount equal to the payments that would be
made on behalf of such Restricted Participant under a single life annuity that
is the Actuarial Equivalent of the sum of his Accrued Benefit and his other
Benefits under the Plan.


 


(3)                                  “Restricted Participant” Defined. For purposes of this Section, “Restricted
Participant” means a Participant who is among the twenty-five (25) highly
compensated employees (as defined in Section 414(q) of the Code) or highly
compensated former employees (as defined in Section 414(q)(9) of the Code)
with the greatest Earnings in the current or any Prior Year.


 


(4)                                  “Benefit” Defined. For purposes of this Section, “Benefit”
includes loans in excess of the amounts set forth in Section 72(p)(2)(A)
of the Code, any periodic income, any withdrawal values payable to a living
Employee or


 


58

















 


former Employee, and any death benefits not provided for by insurance
on the Employee’s or former Employee’s life.


 


(d)                                 Exception to Restrictions. The restrictions contained in this
Article 11 may be exceeded for the purpose of making benefit payments to
Restricted Participants who would otherwise be subject to such restrictions, if
an agreement has been established, in accordance with this
Subsection 11(d), to secure repayment to the Trust of the Restricted
Amount upon termination of the Plan to satisfy Section 401(a)(4) of the
Code.


 


(1)                                  Security for Restricted Participant’s
Repayment Obligation. Prior
to the receipt of a distribution, a Restricted Participant must agree to secure
or collateralize his repayment of the Restricted Amount by:


 


(A)                              promptly depositing in escrow with a
depositary acceptable to the Committee property having a fair market value
equal to at least 125 percent (125%) of the Restricted Amount;


 


(B)                                posting a bond, furnished by an insurance
company, bonding company or other surety approved by the U.S. Treasury
Department as an acceptable surety for federal bonds, equal to at least 100
percent (100%) of the Restricted Amount; or


 


(C)                                providing the Committee with a bank letter of
credit in an amount equal to at least 100 percent (100%) of the Restricted
Amount.


 


(2)                                  Withdrawals or Releases. No provision in the Plan shall prevent a
Restricted Participant from withdrawing from any escrow account established
under this Section any amounts exceeding 125 percent (125%) of the
Restricted Amount. A surety or bank may release any liability exceeding 100
percent (100%) of the Restricted Amount with respect to any bond posted or
letter of credit provided under this Section.


 


(3)                                  Other Requirements for Escrow Accounts. If the market value of the property in an escrow
account established under this Section falls below 110 percent (110%) of
the Restricted Amount, the Restricted Participant is obligated to deposit
additional property to bring the value of the property held by the depositary
up to 125 percent (125%) of the Restricted Amount. Subject to the preceding
sentence, no provision in the Plan shall prevent a Restricted Participant from
withdrawing any income from the property placed in escrow.


 


(4)                                  Certification by Committee. If at any time after distribution of a
Restricted Amount commences,


 


(A)                              the value of Plan Assets equals or exceeds
110 percent (110%) of the value of the Plan’s current liabilities;


 


59

















 


(B)                                the value of the Restricted Participant’s
future payments that could have been distributed to the Restricted Participant,
beginning when distribution commenced to the Restricted Participant, had the
Restricted Participant received payments as provided under Subsection 1
l(c)(2), constitutes less than one percent (1%) of the value of the Plan’s
current liabilities; or


 


(C)                                the Plan has terminated and the benefit
received by the Restricted Participant is nondiscriminatory, then the Committee
shall certify to the depositary, surety or bank, as applicable, that the
Restricted Participant is no longer obligated to repay any amount under the
agreement established between the Restricted Participant and the Committee
under this Section.


 


(5)                                  “Restricted Amount” Defined. For purposes of this Section, “Restricted Amount”
means the amount in excess of the amounts distributed to the Restricted
Participant (accumulated with reasonable interest) over the amounts that could
have been distributed to the Restricted Participant under
Subsection 1l(c)(2) (accumulated with reasonable interest).


 


60

















 


ARTICLE 12


 


FUNDING


 


12.1                           Employer Contributions. The Employer shall make contributions to the
Plan at such times and in such amounts as the Employer may determine.


 


12.2                           Return of Employer Contributions to the
Employer.


 


(a)                                  Mistake of Fact. If a contribution by the Employer to the
Plan is made by reason of a mistake of fact, then, subject to (d) below,
such contribution may be returned to the Employer within one (1) year after the
payment of such contribution.


 


(b)                                 Deductibility. Contributions by the Employer to the Plan
are conditioned upon the deductibility of such contributions under
Section 404 of the Code, and, such contributions (to the extent
disallowed) may be returned to the Employer within one (1) year after the
disallowance of the deduction.


 


(c)                                  Limitation on Return. The amount which may be returned to the
Employer under paragraph (a) or (b) above shall be limited to the excess of the
amount contributed over the amount that would have been contributed had there
not occurred a mistake of fact or a mistake in determining the deduction.
Earnings attributable to the excess may not be returned to the Employer, but
losses attributable thereto must reduce the amount to be so returned.


 


12.3                           Application of Forfeitures. Prior to the termination of the Plan, all
forfeitures of benefits arising from termination of employment with the
Employer, death, or any other reason shall not be applied to increase the
benefits any Participant would otherwise be entitled to receive under the Plan,
but may be anticipated in determining the costs under the Plan and shall be
applied to the reduction of the Employer’s contributions to the Plan.


 


12.4                           Funding Policy and Method.


 


(a)                                  Establishment. The Board or any duly appointed committee
thereof shall establish, for the Plan, a funding policy and method, which shall
be consistent with the objectives of the Plan, ERISA and any other applicable
legal requirements and which shall identify the Plan’s short-run and long-run
financial needs with respect to liquidity and investment growth, as the same
may change from time to time. Such funding policy shall be communicated as soon
as practicable to those who are responsible for investment of the Plan Assets


 


(b)                                 Funding Entities. The Plan Assets shall be held by the Plan
and the benefits under the Plan shall be funded through such trusts and/or
annuity contracts as the Board, in their sole discretion, may establish or
cause to be established or entered into for the purposes


 


61

















 


of carrying out the Plan. The Board shall determine the form and terms
of any such trust and/or annuity contract, from time to time, consistent with
the objectives of the Plan, ERISA and any other applicable legal requirements,
and may remove any trustee and/or insurance company and select a successor
trustee or trustees and/or insurance company or may terminate any such trust
and/or annuity contract. Any such trust or annuity contract so established and
maintained is and shall be a part of the Plan.


 


(c)                                  Investment Managers. The Employer, by action of the Board or its
delegate, shall have the power, at any time and from time to time, to appoint
an investment manager or managers (as defined in Section 3(38) of ERISA)
to manage (including the power to acquire and dispose of) any of the Plan
Assets.


 


62

















 


ARTICLE 13


 


ADMINISTRATION


 


13.1                           Named Fiduciaries.


 


(a)                                  Identification. Blue Ridge Paper Products Inc. shall be the
“Named Fiduciary” for the Plan. The Named Fiduciary shall have the full
responsibility and authority to take all actions not expressly enumerated in
the Plan necessary for effective administration of the Plan.


 


(b)                                 Responsibilities. The Named Fiduciary shall discharge its
responsibilities with respect to the Plan in accordance with the documents and
instruments governing the Plan insofar as such documents and instruments are
consistent with the provisions of Title I of ERISA.


 


(c)                                  Powers. The Named Fiduciary shall have the power and authority in its sole,
absolute and uncontrolled discretion to control and manage the operation and
administration of the Plan and shall have all powers necessary to accomplish
these purposes. The responsibility and authority of the Named Fiduciary or its
named delegate shall include but shall not be limited to the following:


 


(1)                                  determining all questions relating to the
eligibility of Employees to participate;


 


(2)                                  determining the amount and kind of benefits payable
to any Participant’s Spouse or Beneficiary;


 


(3)                                  establishing and reducing to writing and
distributing to any Participant or Beneficiary a claims procedure,
administering that procedure including the processing and determination of all
appeals thereunder; and


 


(4)                                  interpreting the provisions of the Plan
including the publication of rules for the regulation of the Plan as in its
sole, absolute and uncontrolled discretion are deemed necessary or advisable
and which are not inconsistent with the express terms hereof of ERISA.


 


In addition to the powers which are expressly provided in the Plan, the
Named Fiduciary or its delegate shall have such powers as are necessary,
appropriate or desirable to enable them to perform their responsibilities,
including the power to establish rules, regulations and forms with respect
thereto.


 


63

















 


13.2                           Procedures for Delegation.


 


(a)                                  Delegations. The Named Fiduciary or the Board may
delegate to one or more persons or entities certain of its fiduciary
responsibilities (other than duties involving the management or control of the
Plan Assets) under an arrangement whereby it shall have the opportunity of such
periodic review of the delegate’s performance as is appropriate under the
circumstances and at such times and in such manner as it may choose for the
purpose of its evaluation of continuing such designation and delegation and
whereby it can promptly terminate the delegate’s services. The named Fiduciary
shall have the sole authority to appoint and remove the Trustee and members of
the Committee. The Committee shall have the sole responsibilities for the
administration of the Plan. The Committee shall consists of no less than three
(3) members.


 


(b)                                 Advisors. The Named Fiduciary shall have the right to employ one or more persons
or entities to render advice with regard to any responsibility it has under the
Plan.


 


(c)                                  Removal, Resignation, and Vacancies. A holder of a delegated position of
fiduciary responsibility (including an individual member of a group holding
such position) may be removed therefrom at any time and without cause by the
person or entity making the delegation and may resign at any time upon prior
written notice to such person or entity. Vacancies in any such positions
created by removal, resignation, death or other cause may be filled by the
person or entity that made the delegation or the fiduciary responsibilities for
such position may be retained and/or redelegated by such person or entity.


 


13.3                           Miscellaneous Administration Provisions.


 


(a)                                  Administrative Expenses. The Employer may pay the reasonable expenses
of administering the Plan, including any expenses incident to the functioning
of the Named Fiduciary or the Committee and the professional fees of any
consultants or advisors with respect to the Plan, or the Employer may direct
that such expenses be paid from the Plan Assets; provided however, no person
who already receives full-time pay from the Employer shall receive any
compensation from the Plan, except for reimbursement of expenses properly and
actually incurred.


 


(b)                                 Indemnification. The Employer may indemnify, through
insurance or otherwise, some or all of the fiduciaries with respect to the Plan
against claims, losses, damages, expenses and liabilities arising from their
performance of their responsibilities under the Plan.


 


(c)                                  Interpretations. All interpretations of the Plan and
questions concerning its administration and application as determined by the
Committee shall be binding on all persons having an interest under the Plan.


 


In exercising its fiduciary functions, the
Committee has the duty and full discretionary authority to determine
eligibility for benefits and to interpret and apply the terms of the Plan,
including making any factual determinations. Using its discretionary authority,
the Committee may correct defects, rectify any omission, or reconcile any


 


64

















 


inconsistency or ambiguity in the Plan. No decision by the Committee
shall be set aside by a court unless the party contesting the decision shall
prove by clear and convincing evidence that the decision is arbitrary and
capricious.


 


(d)                                 Uniform and Non-Discriminatory Application. All determinations and actions under the
Plan shall be uniformly and consistently applied in a non-discriminatory manner
to all persons under similar circumstances.


 


(e)                                  Qualified Domestic Relations Order
Procedures. The Committee
shall establish reasonable procedures to determine the qualified status, under
Section 414(p) of the Code, of domestic relations orders and to administer
distributions under such qualified orders.


 


(f)                                    Effectiveness of Elections, etc. An election, designation, request or
revocation provided for in the Plan shall be made in writing and shall not
become effective until it has been properly filed with the Committee.


 


(g)                                 Written Records. The Named Fiduciary shall maintain all such
books of account and other records and data as are necessary for the proper
performance of its responsibilities under the Plan.


 


(h)                                 Administration Consistent with ERISA and the
Code. The Plan is intended
to comply with the provisions of ERISA and of the Code, and the Plan shall be
interpreted and administered consistently with such provisions and with the
applicable regulations and rulings thereunder.


 


(i)                                     Recovery of Payments Made by Mistake. Notwithstanding anything to the contrary, a
Participant or Beneficiary is entitled to only those benefits provided by the
Plan and promptly shall return any payment, or portion thereof, made by
mistake, of fact or law. Further, notwithstanding anything to the contrary, an
alternate payee under a Qualified Domestic Relations Order is entitled to only
those benefits from the Plan as are designated by the Order and promptly shall
return any payment, or portion thereof, made by mistake of fact or law. The
Committee may offset the future benefits of any recipient who refuses to return
an erroneous payment, in addition to pursuing any other remedies provided by
law.


 


(j)                                     Service in More Than One Fiduciary Capacity. Any person or entity may serve in more than
one fiduciary capacity for the Plan, including service both as a Committee
member and as trustee.


 


13.4                           Initial Claims Procedure.


 


(a)                                  Claim.


 


(1)                                  Filing. In order to present a complaint regarding the nonpayment of a Plan
benefit or a portion thereof (a “Claim”), a Participant or Beneficiary under
the Plan (a “Claimant”) or his duly authorized representative must file such
Claim by mailing or delivering in person or by electronic media (if so


 


65

















 


allowed by ERISA and approved by the Committee) a statement regarding
such Claim to: the Retirement Committee, Blue Ridge Paper Products IncOne West
Pack Square, Suite 1100, Asheville, NC 28801. A Claim includes a determination
of whether specific employment will be Section 203(a)(3)(B) service for
purposes of the suspension of benefits.


 


(2)                                  Acknowledgement. Upon such receipt of a Claim, the Committee
shall furnish to the Claimant an acknowledgement which shall inform such
Claimant of the time limit set forth in (b)(l) below and of the effect,
pursuant to (b)(3) below, of failure to decide the Claim within such time
limit.


 


(b)                                 Initial Decision.


 


(1)                                  Time Limit. The Committee shall decide upon a Claim within a reasonable period of
time after receipt of such Claim; provided however, that such period shall in
no event exceed ninety (90) days, unless special circumstances require an
extension of time for processing. If such an extension of time for processing
is required, then the Claimant shall, prior to the termination of the initial
ninety (90) day period, be furnished a notice indicating such special
circumstances and the date by which the Committee expects to render a decision.
In no event shall an extension exceed a period of ninety (90) days from the end
of the initial period.


 


(2)                                  Notice of Denial. If the Claim is wholly or partially denied,
then the Committee shall furnish to the Claimant, within the time limit
applicable under (1) above, a notice setting forth in a manner calculated to be
understood by the Claimant:


 


(A)                              the specific reason or reasons for such
denial;


 


(B)                                specific reference to the pertinent Plan
provisions on which such denial is based;


 


(C)                                a description of any additional material or
information necessary for such Claimant to perfect his Claim and an explanation
of why such material or information is necessary; and


 


(D)                               appropriate information as to the steps to be
taken if such Claimant wishes to submit his Claim for review pursuant to
Section 13.5, including notice of the time limits set forth in
Section 13.5(b)(2).


 


(3)                                  Deemed Denial for Purposes of Review. If a Claim is not granted and if, despite
the provisions of (1) and (2) above, notice of the denial of a Claim is not
furnished within the time limit applicable under (1) above, then the


 


66

















 


Claimant may deem such Claim denied and may request a review of such
deemed denial pursuant to the provisions of Section 13.5.


 


13.5                           Claim Review Procedure.


 


(a)                                  Claimant’s Rights. If a Claim is wholly or partially denied
under Section 13.4, then the claimant or his duly authorized
representative shall have the following rights:


 


(1)                                  to obtain, subject to (b) below, a full and
fair review;


 


(2)                                  to review pertinent documents; and


 


(3)                                  to submit issues and comments.


 


(b)                                 Request for Review.


 


(1)                                  Filing. To obtain a review pursuant to (a) above, a Claimant entitled to such
a review or his duly authorized representative shall, subject to (2) below,
mail or deliver or by electronic media request such a review (a “Request for
Review”) to: the Retirement Committee, Blue Ridge Paper Products Inc., One West
Pack Square, Suite 1100, Asheville, NC 28801. The Request for Review may also
be delivered by electronic media if so allowed by ERISA and approved by the
Committee.


 


(2)                                  Time Limits for Requesting a Review. A Request for Review must be mailed or
delivered in person or by electronic media if so allowed by ERISA and approved
by the Committee within sixty (60) days after receipt by the Claimant of notice
of the denial of the Claim or within such longer period as is reasonable and
related to the nature of the benefit which is the subject of the Claim and to
other attendant circumstances.


 


(3)                                  Acknowledgement. Upon such receipt of a Request for Review,
the Committee shall furnish to the Claimant an acknowledgement which shall
inform such Claimant of the time limit set forth in (c)(l) below and of the
effect, pursuant to (c)(3) below, of failure to furnish a decision on review
within such time limit.


 


(c)                                  Decision on Review.


 


(1)                                  Time Limit.


 


(A)                              General. If, pursuant to (b) above, a review is requested, then, except as
otherwise provided in (B) below, the Committee (but only if such delegate has been
given the authority to make a final decision on the Claim) shall make a
decision promptly and no later than sixty (60) days after receipt of the
Request for Review; except


 


67

















 


that, if special circumstances require an extension of time for
processing, then the decision shall be made as soon as possible but not later
than one hundred twenty (120) days after receipt of the Request for Review. The
Committee must furnish the Claimant notice of any extension prior to its
commencement.


 


(B)                                Regularly Scheduled Meetings. Anything to the contrary in (A) above
notwithstanding, if the decision on review is to be made by a committee which
holds regularly scheduled meetings at least quarterly, then its decision on review
shall be made no later than the date of the meeting which immediately follows
the receipt of the Request for Review; provided however, if such Request for
Review is received within thirty (30) days preceding the date of such meeting,
then such decision on review shall be made no later than the date of the second
meeting which follows such receipt; and provided further that, if special
circumstances require a further extension of time for processing, and if the
Claimant is furnished notice of such extension prior to its commencement, then
such decision on review shall be rendered no later than the third meeting which
follows such receipt.


 


(2)                                  Notice of Decision. The Committee shall furnish to the Claimant,
within the time limit applicable under (1) above, a notice setting forth in a
manner calculated to be understood by the Claimant:


 


(A)                              the specific reason or reasons for the
decision on review; and


 


(B)                                specific reference to the pertinent Plan
provisions on which the decision on review is based.


 


(3)                                  Deemed Denial. If, despite the provisions of (1) and (2)
above, the decision on review is not furnished within the time limit applicable
under (1) above, then the Claimant shall be deemed to have exhausted his
remedies under the Plan and he may deem the Claim to have been denied on
review.


 


13.6                           Electronic Administration. The Committee may distribute and collect
information or conduct transactions by means of electronic media, including,
but not limited to, electronic mail systems, Internet, or voice response unit,
except when a specific provision of the Internal Revenue Code of 1986, as
amended, Employee Retirement Income Security Act of 1974, as amended, or other
guidance of general applicability sets forth rules or standards regarding the
media through which such dissemination of information or transaction may be
conducted.


 


68

















 


ARTICLE 14


 


AMENDMENT AND TERMINATION


 


14.1                           Amendment and Termination.


 


(a)                                  Right to Amend or Terminate. Blue Ridge Paper Products Inc. expects the
Plan to be permanent, but since future conditions cannot be anticipated or
foreseen, it must necessarily and hereby does reserve the right to amend or
terminate the Plan at any time by action of the Board; provided however, any
amendment which is not a substantive amendment shall be made on behalf of the
Employer by the Committee with the approval of the Chief Executive Officer of
Blue Ridge Paper Products Inc.


 


(b)                                 Automatic Termination of the Plan. The Plan shall automatically terminate upon
the discontinuance or liquidation of the Employer’s business unless a successor
business organization elects to continue the Plan.


 


(c)                                  Conditions on Amendments and Termination.


 


(1)                                  Accrued Benefit.


 


(A)                              General. No amendment to the Plan (including a change in the actuarial basis
for determining optional or early retirement benefits) shall be effective to
the extent that it has the effect of reducing a Participant’s Accrued Benefit,
except as permitted under Section 412(c)(8) of the Code.


 


(B)                                Treatment of Certain Amendments. For purposes of (A) above, an amendment
which has the effect, with respect to the benefits attributable to service
before the amendment, of:


 


(i)                                     eliminating or reducing an early retirement
benefit or a retirement-type subsidy, or


 


(ii)                                  (except as otherwise provided by Treasury
regulations) eliminating an optional form of benefit, shall be treated as
reducing Accrued Benefits. In the case of a retirement-type subsidy, the
preceding sentence shall apply only with respect to a Participant who satisfies
(either before or after the amendment) the pre-amendment conditions for the
subsidy.


 


69

















 


(2)                                  Changes in Vesting Schedule. No amendment shall reduce the nonforfeitable
percentage of a Participant’s Accrued Benefit (determined as of the later of
the date such amendment is adopted or the date such amendment becomes
effective). Notwithstanding the foregoing, if the Plan is amended to change a
vesting schedule (the “prior vesting schedule”) a Participant’s vested
percentage on the effective date of the amendment shall not be less than the
vested percentage calculated under the prior vesting schedule as of the
later of the adoption date of the amendment, or the effective date of the
amendment. In addition, a Participant with three (3) or more years of Vesting
Service as of the later of the adoption date of the amendment, the effective
date of the amendment, or the date the Participant is notified of the
amendment, shall have the right to irrevocably elect the prior vesting
schedule. Such Participant shall have a period of sixty (60) days to elect the
prior vesting schedule. However, no election shall be available if the new
vesting schedule provides equal or superior vesting at each level as compared
to the prior vesting schedule.


 


(3)                                  Termination of the Plan. Upon termination of the Plan as provided (a)
above, the Board shall deliver a written notice of termination of the Plan to
the Committee and the Trustee, which notice shall show the effective date of
said termination. The Committee will then, in accordance with the requirements
of ERISA, notify the Participants, terminated vested Participants, retired
Participants, Beneficiaries, and the Pension Benefit Guaranty Corporation that
the Plan is to be terminated. Upon satisfaction of the requirements of ERISA
applicable to terminating pension plans, the Committee will carry out the
provisions in the remainder of this Section unless pursuant to law,
required to do otherwise.


 


If the Pension benefit Guaranty Corporation, pursuant to
Section 404 of ERISA, notifies the Committee that the Plan is to be
terminated and applies for and is granted a decree by the United States
District Court having jurisdiction over such matters requiring the Plan to be terminated,
the Committee or Trustee appointed by the aforesaid court pursuant to said
Corporation’s application will carry out the provisions in the remainder of
this Section.


 


In the event of a complete termination of the Plan, all Employer
contributions shall cease, no additional Employees shall enter the Plan, and
each Participant shall be fully vested and nonforfeitable in his Accrued
Benefit to the extent funded after reduction for expenses of administration and
liquidation of the Trust, but in no event will he be vested in more than his
then Accrued Benefit. In the event of a complete termination of the Plan, the
benefit of a Participant who is a “highly compensated employee” or a “highly
compensated former employee” as those terms are defined in Code Section 401(a)(4).
The amount allocable


 


70

















 


to a Participant shall be determined in accordance with the provisions
of the Code and of ERISA, as applicable, and shall be distributed to him in
accordance with the requirements thereof.


 


Upon completion of the steps specified above, the Plan will be regarded
as finally terminated with respect to the Employer, and no Participant, retired
Participant, or Beneficiary shall have any further right to claim to any
benefits under the Plan.


 


14.2                           Allocation of Plan Assets Upon Termination of
the Plan.


 


(a)                                  General Provisions. In the event of the termination of the Plan,
the Committee shall allocate the assets of the Plan (available to provide
benefits) among the Participants and Beneficiaries of the Plan pursuant to
Section 4044 of ERISA and the applicable regulations and rulings
promulgated thereunder.


 


(b)                                 Residual Assets.


 


(1)                                  Any residual assets remaining upon
termination of the Plan shall be distributed to the Employer if:


 


(A)                              all liabilities (fixed and contingent) of the
Plan to Participants and their Beneficiaries have been satisfied, and


 


(B)                                the distribution does not contravene any
provision of law.


 


(2)                                  Notwithstanding the provisions of paragraph
(1), if any assets of the Plan attributable to employee contributions remain
after all liabilities of the Plan to Participants and their Beneficiaries have
been satisfied, such assets shall be equitably distributed to the Employees who
made such contributions (or their Beneficiaries) in accordance with their rate
of contributions.


 


71

















 


 


ARTICLE 15


 


TOP-HEAVY RULES


 


15.1                           Definitions. For purposes of this Article 15, the following terms shall have
the following meanings:


 


(a)                                  “Aggregation Group”
means:


 


(1)                                  each qualified plan or simplified employee
pension of the Employer or an Affiliate in which a Key Employee is a
participant;


 


(2)                                  each other plan of the Employer or an
Affiliate which enables any plan described in (1) above to meet the
requirements of Section 401(a)(4) or 410 of the Code;


 


(3)                                  any other plan or plans which the Employer
elects to include provided that the group would continue to meet the
requirements of Sections 401(a)(4) and 410 of the Code with such plan or plans
being taken into account; and


 


(4)                                  any terminated plan which if it had not been
terminated would have been included in the foregoing.


 


(b)                                 “Determination Date”, with respect to
any Plan Year for the Plan, means the last day of the preceding Plan Year (or,
in the case of the first Plan Year of the Plan, the last day of such Plan
Year).


 


(c)                                  “Determination Period” means, with
respect to any Plan Year, the five Plan Years ending on the Determination Date
with respect to such Plan Year.


 


(d)                                 “Key Employee”, with respect to any
Plan Year, means, as determined under Section 416(i) of the Code, any
person who, at any time during the Determination Period with respect to such
Plan Year, is:


 


(1)                                  an officer of the Employer or an Affiliate
who:


 


(A)                              has annual compensation (as defined in
Section 414(q)(7) of the Code) (annual compensation as defined in
Section 10.1(c) for years beginning before January 1, 1990) greater
than fifty percent (50%) of the dollar limitation in effect under
Section 415(b)(l)(A) of the Code for any such Plan Year, and


 


(B)                                is taken into account under
Section 4l6(i) of the Code;


 


72

















 


(2)                                  one of the ten (10) Employees who:


 


(A)                              owns (or is considered as owning within the
meaning of Sections 318 and 416(i) of the Code) both more than a one half
percent (1/2% ) ownership interest in value and one of the ten (10) largest
percentage ownership interests in value of the Employer; and


 


(B)                                has (during the Plan Year of ownership)
annual compensation (as defined in Section 414(q)(7) of the Code) (annual
compensation as defined in Section 10.1(c) for years beginning before
January 1, 1990) from the Employer and any Affiliates of more than the
limitation in effect under Section 415(c)(l)(A) of the Code for the
calendar year in which such Plan Year ends;


 


 


(3)                                  a 5-percent (5%) owner (as defined in
Section 416(i) of the Code) of the Employer; or


 


(4)                                  a 1-percent (1%) owner (as defined in
Section 416(i) of the Code) of the Employer having annual compensation (as
defined in section 414(q)(7) of the Code) (annual compensation as defined
in Section 10.1(c) for years beginning before January 1, 1990) from
the Employer and any Affiliates of more than $150,000.


 


(e)                                  “Non-bargaining Participant” means a
Participant who is not included in a unit of Employees covered by a collective
bargaining agreement.


 


(f)                                    “Present Value.” with respect to
Accrued Benefits under the Plan, shall be determined as of the most recent
Valuation Date which is within a twelve (12)-month period ending on the
applicable Determination Date and shall be determined on the basis of the
following actual assumptions:


 


(i)                                     interest: the Pension Benefit Guaranty
Corporation, rate of interest for valuing immediate annuities, as in effect on
the applicable Valuation Date;


 


(ii)                                  mortality: the 1971 TPF&C Forecast
Mortality Table for male lives with a one year setback.


 


(g)                                 “Top-Heavy Plan” means the Plan, with
respect to any Plan Year after 1983, if the Top-Heavy Ratio exceeds 60 percent
(60%).


 


(h)                              “Top-Heavy Ratio” means, for the Plan or an Aggregation Group of
which the Plan is a part, a fraction, the numerator of which is the sum of
defined contribution account balances and the Present Values of defined benefit
Accrued Benefits for all Key Employees and the denominator of which is the sum
of defined contribution account balances and the Present Values of defined
benefit Accrued Benefits for all participants.


 


73

















 


The Top-Heavy Ratio shall be determined in
accordance with Section 416 of the Code and the applicable regulations
thereunder, including, without limitation, the provisions relating to rollovers
and the following provisions:


 


(1)                                  The value of Accrued Benefits under the Plan
will be determined as of the Determination Date with respect to the applicable
Plan Year.


 


(2)                                  The value of account balances and Accrued
Benefits under plans aggregated with the Plan shall be calculated with
reference to the Determination Dates under such plans that fall within the same
calendar year as the applicable Determination Date under the Plan.


 


(3)                                  The value of account balances and the Present
Value of Accrued Benefits will be determined as of the most recent Valuation
Date that falls within or ends with the twelve (12) month period ending on the
applicable Determination Date, except as provided in Section 416 of the
Code and the regulations thereunder for the first and second plan years of a
defined benefit plan.


 


(4)                                  A simplified employee pension shall be
treated as a defined contribution plan; provided however, at the election of
the Employer, the Top-Heavy Ratio shall be computed by taking into account
aggregate employer contributions in lieu of the aggregate of the accounts of
Employees.


 


(5)                                  Distributions (including distributions under
a Plan which if it had not been terminated would have been included) within the
five (5) year period ending on a Determination Date shall be taken into
account.


 


(6)                                  Defined contribution account balances shall
be adjusted to reflect any contribution not actually made as of a Determination
Date but required to be taken into account on that date under Section 416
of the Code and the regulations thereunder.


 


(7)                                  Deductible voluntary, contributions shall not
be included.


 


(8)                                  There shall be disregarded the account
balances and Accrued Benefits of a Participant:


 


(A)                              who is not a Key Employee but who was a Key
Employee in a prior Plan Year or


 


(B)                                who has not performed services for the
Employer maintaining the plan at any time during the five (5)-year period
ending on the Determination Date.


 


74

















 


(9)                                  The Accrued Benefit of a Participant other
than a Key Employee shall be determined.


 


(A)                              under the method, if any, which uniformly
applies for accrual purposes under all defined benefit plans of the Employer,
or


 


(B)                                if there is no such method, as if such
benefit accrued not more rapidly than the slowest accrual rate permitted under
the fractional rule of Section 41l(b)(l)(C) of the Code.


 


(i)                                     “Valuation Date” means the valuation
date used for computing Plan costs for minimum funding, regardless of whether a
valuation is performed that year.


 


15.2                           Minimum benefit.


 


(a)                                  General. If the Plan is a Top-Heavy Plan for any Plan Year, then each
Non-bargaining Participant who is a Participant in such Plan Year, who is not a
Key Employee, and who has a Vesting Year for such Plan Year, shall have an
Accrued Benefit of not less than the minimum determined under this Section.
Such Benefit shall not be reduced in subsequent Plan Years.


 


(b)                                 Amount. For purposes of this Section, the minimum benefit, expressed as a
single life annuity commencing at Normal Retirement Age, shall be equal to the
product of:


 


(1)                                  one-twelfth (1/12) of the Participant’s
average Earnings, as defined in Section 10.1(c) but taking into account as
such Earnings to Section 416(d) of the Code for the cost of living), for
the five (5) consecutive Plan Years during which the Participant has the
highest aggregate Earnings (disregarding any such Plan Year for which the
Participant did not earn a Vesting Year and disregarding any such Plan Year
beginning before January 1, 1984 or after the close of the last Plan Year
in which the Plan is a Top-Heavy Plan); and


 


(2)                                  the lesser of:


 


(A)                              2 percent (2%) multiplied by his Vesting
Years, excluding


 


(i)                                     any such years completed in Plan Years
beginning before January 1, 1984, and


 


(ii)                                  any such years with, or within, which ends
any Plan Year for which the Plan was not a Top-Heavy Plan; or


 


(B)                                20 percent (20%).


 


75

















 


(c)                                  Actuarial Adjustment. If a Participant’s benefit is paid in any
form other than a single life annuity commencing at Normal Retirement Age, then
the minimum benefit under (b) above shall be adjusted to the Actuarial
Equivalent of such an annuity.


 


15.3                           Vesting Requirements.


 


(a)                                  Top-Heavy Years. Anything in Section 5.2 to the contrary
notwithstanding, for any Plan Year for which the Plan is a Top-Heavy Plan, a
Non-bargaining Participant who has at least one Hour of Service after the Plan
becomes a Top-Heavy Plan shall have a nonforfeitable right to a percentage of
his Accrued Benefit determined under the following table; provided however, no
Participant’s vested percentage (as of the day before the Plan’s becoming a
Top-Heavy Plan) shall, be reduced:


 




	
  Vesting Years

  	
   

  	
  Nonforfeitable Percentage

  	
   

  
	
  Less
  than 3

  	
   

  	
  0

  	
  %

  
	
  3
  or more

  	
   

  	
  100

  	
  %

  






 


(b)                                 Subsequent Years. If a Participant is covered under the Plan
for a Plan Year in which the Plan is a Top-Heavy Plan and the Plan then ceases
to be a Top-Heavy for a subsequent Plan Year, then, for each such subsequent
Plan Year, the following provisions shall apply:


 


(1)                                  the amount of such Participant’s
nonforfeitable Accrued Benefit shall not be less than the amount of his nonforfeitable
Accrued Benefit as of the end of the last Plan Year for which the Plan was a
Top-Heavy Plan; and


 


(2)                                  if such Participant has credit for at least
three (3) Vesting Years as of the end of the last Plan Year for which the Plan
is a Top-Heavy Plan, then the vesting schedule in (a) above shall continue
to apply to such Participant.


 


15.4                           Limitations on Benefits. If a Limitation Year contains any portion of
a Plan Year for which the Plan is a Top-Heavy Plan, then, for purposes of the
computation of the Defined Benefit Plan Fraction and Defined-Contribution Plan
Fraction under Article 10, shall be substituted for 1.25; provided
however, any limitation which results from the application of this sentence may
be exceeded so long as there are no Defined Benefit Plan accruals for the
individual and no employer contributions, forfeitures, or voluntary
nondeductible contributions allocated to the individual.


 


76

















 


ARTICLE 16


 


MISCELLANEOUS


 


16.1                           Construction.


 


(a)                                  Article and Section References. Except as otherwise indicated by the
context, all references to Articles, Sections or Subsections in the Plan refer
to Articles, Sections or Subsections of the Plan. The titles thereto are for
convenience of reference only and the Plan shall not be construed by reference
thereto.


 


(b)                                 Gender and Number. As used in the Plan, except when otherwise
indicated by the context, the genders of pronouns and the singular and plural
numbers of terms shall be interchangeable.


 


16.2                           Assignment or Alienation of Benefits. Benefits provided under the Plan may not be
anticipated, assigned (either at law or in equity), alienated or subject to
attachment, garnishment, levy, execution or other legal or equitable process;
provided however, benefits shall be paid in accordance with the applicable
requirements of any domestic relations order which is a qualified domestic
relations order (as defined in Section 206(d) of ERISA or
Section 414(p) of the Code) and certain judgements and settlements pursuant
to Section 401(a)(13)(C) of the Code. Except as provided in the foregoing,
if any attempt shall be made to reach the beneficial interest of any
Participant or Beneficiary by legal process not preempted by ERISA, the
Committee may suspend any right of distribution which any Participant or
Beneficiary may have, and may direct that such person’s beneficial interest
hereunder be paid over or applied for the benefit of such person, or for the
benefit of dependents of such person, as the Committee shall determine.


 


16.3                           Data.


 


(a)                                  Obligation to Furnish. Each person who participates or claims
benefits under the Plan shall furnish to the Committee, any trustee, or any
insurance company involved in the funding of the benefits under the Plan, such
signatures, documents, evidence, or information as the Committee, such trustee,
or such insurance company shall consider necessary or desirable for the purpose
of administering the Plan.


 


(b)                                 Mistakes or Misstatements. In the event of a mistake or a misstatement
as to any item of such information, as is furnished pursuant to (a) above,
which has an effect on the amount of benefits to be paid under the Plan, or
in-the event of a mistake or misstatement as to the amount of payments to be
made to a person entitled to receive a benefit under the Plan, the Committee
shall cause such amounts to be withheld or accelerated, as shall in its
judgment accord to such person the payment to which he is properly entitled
under the Plan.


 


77

















 


16.4                           Employment Relationship.


 


(a)                                  No Enlargement of Rights. Except as otherwise provided by law or
legally enforceable contract, the establishment of the Plan or of any fund or
any insurance contract thereunder, any amendment of the Plan, participation in
the Plan, or the payment of any benefits under the Plan, shall not be construed
as giving any person whomsoever any legal or equitable claims or rights against
the Employer, or its officers, directors, or shareholders, as such, or as
giving any person the right to be retained in the employment of the Employer.


 


(b)                                 Employer’s Rights. The right of the Employer to discipline or
discharge an Employee shall not be affected by reason of any of the provisions
of the Plan.


 


16.5                           Merger. Consolidation, or Transfer of Assets
or Liabilities. In the event
of the dissolution, merger, consolidation, or reorganization of the Employer,
provision may be made by which the Plan and Trust shall be continued by the
successor and, in that event, such successor shall be substituted for the
Employer under the Plan. The substitution of the successor shall constitute an
assumption of Plan liabilities by the successor, and the successor shall have
all the powers, duties and responsibilities of the Employer under the Plan.


 


In the event of any merger or consolidation of the Plan with, or
transfer in whole or in part of the assets and liabilities of the Trust Fund
to, another trust fund held under any other plan of deferred compensation
maintained or to be established for the benefit of all or some of the
Participants of this Plan, the assets of the Trust Fund applicable to such
Participant shall be transferred to the other trust fund only if:


 


(a)                                  Each Participant would (if either this Plan
or the other plan then terminated) receive a benefit immediately after the
merger, consolidation, or transfer which is equal to or greater than the
benefit he would have been entitled to receive immediately before the merger,
consolidation, or transfer (if this Plan had then terminated);


 


(b)                                 Resolutions of the Board of Directors of Blue
Ridge Paper Products Inc. and of the board of directors of any new or successor
employer of the affected Participants, shall authorize such transfer of assets;
and in the case of the new or successor employer of the affected Participants,
its resolution shall include an assumption of liabilities with respect to such
Participant’s inclusion in the new employer’s plan; and


 


(c)                                  Such other plan and trust are qualified under
Section 401(a) and 501(a) of the Code.


 


16.6                           Incompetency or Disability.


 


(a)                                  Each person to whom a distribution is payable
under the Plan shall be conclusively presumed to be mentally competent and not
under a disability that renders


 


78

















 


him unable to care for his affairs, until the date on which the
Committee receives a notice, in a form and manner acceptable to the Committee,
to the contrary.


 


(b)                                 Unless (c) below applies, if the Committee
shall find that any individual to whom any benefit is payable under the Plan is
unable to care for his or her affairs, is a minor, or has died, then any
payment due to him or his estate (unless a prior claim has been made by a duly
appointed legal representative) may be paid to the Spouse, child, relative,
institution maintaining or having custody or such individual, or any other
person or entity deemed by the Committee to be a proper recipient on behalf of
such individual otherwise entitled to payment, or the Committee in its
discretion may hold such payment until a legal representative, deemed as such
by the Committee, is appointed. Any such payment shall be a complete discharge
of liabilities of the Plan with respect to that individual.


 


(c)                                  If such a notice indicates that a guardian,
conservator, or other party legally vested with the care of the person or the
estate of such person has been appointed by a court of competent jurisdiction,
then any payment of a distribution due shall be made to such appointed persons
or entity, provided that proper proof of appointment and continuing
qualification is furnished in a form and manner acceptable to the Committee.
The Committee shall not be required to look to the application of any such
payment so made.


 


16.7                           Annuity Contracts. In order to provide the benefit to which any
person is entitled under the Plan, the Committee may distribute an annuity
contract pursuant to the terms of which the person’s benefit is to be provided
in compliance with the terms of the Plan. Any annuity contract distributed from
the Plan must be nontransferable. Upon the distribution of such an annuity
contract, the person entitled to the contract shall have no further rights to a
benefit under the Plan; and his rights shall be determined solely by the terms
of the annuity contract. Any recourse for a failure of the issuer of the
annuity contract to pay all benefits or otherwise follow the terms of the
annuity contract shall be against the issuer and not the Plan, the Employer or
the Committee.


 


16.8                           Governing Law. The Plan and all rights and duties under
the Plan shall be governed, construed and administered in accordance with the
laws of the State of North Carolina, except as governed separately by or
preempted by federal law.


 


16.9                           Severability. In case any provision of this Plan shall be
held illegal or invalid for any reason, such illegality or invalidity shall not
affect the remaining provisions of this Plan, and this Plan shall be construed
and interpreted as if such illegal or invalid provision had never been a part
of it.


 


79

















 


IN
WITNESS WHEREOF, An officer of Blue Ridge Paper Products Inc. has executed this
Plan as evidence of its adoption as of 7 28, 2000.


 


 


	
   

  	
  BLUE
  RIDGE PAPER PRODUCTS INC.

  
	
   

  	
   

  
	
   

  	
  BY

  	
  /s/
  [ILLEGIBLE]

  	
   

  
	
   

  	
   

  	
  VICE
  PRESIDENT HUMAN RESOURCE

  	
   

  
	
   

  	
   

  	
  Title

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  ATTEST:

  	
   

  
	
  By

  	
   

  	
   

  	
   

  
							



 


80

















 


APPENDIX
ONE


 


RETIREMENT
PLAN FOR SALARIED EMPLOYEES OF BLUE RIDGE PAPER

PRODUCTS INC.


 


MONTHLY BENEFITS


 


Appendix One will be used to determine actuarially equivalent monthly
benefits under the Plan.


 


In computing Actuarial Equivalents under the Plan for purposes not
otherwise covered by the tables in this Appendix, unless otherwise specified in
the Plan, the following actuarial assumptions shall be used:


 


	
  Interest:

  	
   

  	
  7.5%

  
	
   

  	
   

  	
   

  
	
  Mortality:

  	
   

  	
  1971
  TPF&C Forecast

  
	
   

  	
   

  	
  Mortality
  Table for male lives

  with a one year setback

  



 


 


All lump sum values for cash out purposes will be determined as
provided in Section 2.3.


 


81

















 


APPENDIX ONE


 


CONTINGENT ANNUITANT FACTORS


 


	
   

  	
  TABLE
  1

  



 


ACTURIAL EQUIVALENT FACTORS


 


	
  OPTION

  	
   

  	
  BASIC
  FACTOR

  	
   

  	
  ADJUSTMENT
  FOR DIFFERENCE IN AGES

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  50%
  Contingent

  Annuitant Option

  	
   

  	
  0.900

  	
   

  	
  +.004
  for each full year by which the Contingent Annuitant is older than the employee

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  -.004
  for each full year by which the Contingent Annuitant is more than 5 years
  younger than the employee

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  75%
  Contingent

  Annuitant Option

  	
   

  	
  0.850

  	
   

  	
  +.006
  for each full year by which the Contingent Annuitant is older than the employee

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  -.006
  for each full year by which the Contingent Annuitant is more than 5 years
  younger than the employee

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  100%
  Contingent

  Annuitant Option

  	
   

  	
  0.800

  	
   

  	
  +.008
  for each full year by which the Contingent Annuitant is older than the
  employee

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  -.008
  for each full year by which the Contingent Annuitant is more than 5 years
  younger than the employee

  



 


NOTE: With respect to the Grandfathered Benefits for Former St. Regis
Employees under Section 4.4, the ADJUSTMENT FOR DIFFERENCE IN AGES applies
for such full year by which the Contingent Annuitant is more than 5 years older
or younger than the Employee.


 


82

















 


APPENDIX ONE


 


LIFE-PERIOD CERTAIN OPTION
FACTORS


 


AND


 


FULL CASH REFUND FACTOR


 


TABLE 2


 




	
  OPTION

  	
   

  	
  ACTUARIAL
  REDUCTION

  FACTOR

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  60 Months Certain and Life Thereafter

  	
   

  	
  0.98

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  120 Months Certain and Life Thereafter

  	
   

  	
  0.93

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  180 Months Certain and Life Thereafter

  	
   

  	
  0.87

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  240 Months Certain and Life Thereafter

  	
   

  	
  0.81

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Full Cash Refund Annuity Option

  	
   

  	
  0.92

  	
   

  






 


NOTE:
Under the Full Cash Refund Annuity Option the initial refund amount is equal to
the lump sum value of the employee’s monthly life annuity benefit as of his
retirement date i.e., his immediate monthly life annuity times the appropriate
factor from this Appendix for determining Monthly Benefits.


 


83

















 


ADDENDUM TO THE RETIREMENT PLAN FOR
SALARIED EMPLOYEES OF BLUE RIDGE PAPER PRODUCTS INC.


 


Provisions
relating to the Champion International Corporation

Salaried Retirement Plan #001


 


Transferred Employees and Former Champion Employees as defined in the
Retirement Plan For Salaried Employees of Blue Ridge Paper Products Inc. (the
“Plan”) were salaried employees of Champion International Corporation
(“Champion”) prior to May 14, 1999, and Transferred Employees were covered by
the Champion International Corporation Salaried Retirement Plan #001 (the
“Champion Plan”) through May 13, 1999. Actual Earnings, Adjusted Earnings, Service,
Offset Benefits, Grandfathered Benefits, Preretirement Survivor Annuity Rights,
Withdrawal Rights, and Death Benefits prior to May 14, 1999 will be determined
for Transferred Employees and Former Champion Employees under the terms of the
Champion Plan as in effect on May 13, 1999 and as set forth in this Addendum.


 


In this connection the following are applicable to the Retirement Plan
For Salaried Employees of Blue Ridge Paper Products Inc.:


 


ARTICLE 2:


 


“Actual Earnings”. The words “Actual Earnings” prior to May 14,
1999 shall have the same meaning as reflected in the Plan with the following
additional exclusions:


 


(1)          any payments under the Sustain Performance Incentive Awards Program
maintained by Champion;


 


(2)          cash payments of flexible benefits dollars not used to purchase
benefits under a plan established under Section 125 of the Code;


 


(3)          any other special or extraordinary compensation; provided however, the
“basic” 12 weeks Interim Pay under the Champion’s “Special Termination
Benefits” Policy for Salaried Employees dated October 9, 1984 or the
“Special Termination Benefit” Policy for Champion Salaried Employees dated
October 8, 1985 shall be included in Actual Earnings.


 


“Adjusted Earnings”. The words “Adjusted Earnings” prior to May
14, 1999 shall have the same meaning as reflected in the Plan with the
following additional clarification for any Transferred Employee who is a Former
St. Regis Employee, for any Plan Year prior to 1985 (or 1986, for purposes of
Exhibit Two to the Addendum), an amount equal to such Participant’s basic
annual rate of compensation, including all commissions and any amounts deferred
by the Participant under one or more salary reduction agreements under Sections
125 or 401(k) of the Code but excluding any bonus (except annual incentive
awards made in 1982 and thereafter under the St. Regis Corporation Management
Incentive Compensation Plan), overtime payment or other additional, special or
supplemental compensation.


 


84

















 


“Average Earnings”.  The words “Average Earnings” prior to May 14,
1999 shall have the same meaning as reflected in the Plan in Section 2.7
with the following additional clarification for Transferred Employees or Former
Champion Employees:


 


For the purpose of Subsection 2.7(a)(2)
of the Plan, the Actual Earnings, or Adjusted Earnings where applicable,
received in the fifth preceding Plan Year shall not include earnings
attributable to the Champion International Corporation Management Incentive
Program and/ or other Business Unit Incentive Plans.


 


Average Earnings of a Participant at any
particular time prior to January 1, 1996 shall be his Average Earnings
determined by taking into account any bonuses paid rather than any bonuses
earned in each Plan Year.


 


“Beneficiary”.  The word “Beneficiary” for a Transferred
Employee prior to May 14, 1999 shall mean the following if there is no
designated beneficiary:


 


If there is no designated
beneficiary to receive any amount that becomes payable to a Beneficiary, then,
except as otherwise provided, the Participant’s beneficiary shall be the
Participant’s Surviving Spouse or, if none, then any one or more of the
Following, as the Committee shall select, each to receive such amounts as the
Committee determines, and such selection and determination shall be final and
binding upon all parties concerned:


 


(a)                                  one or more of all of the next of kin of such
Participant


 


(b)                                 the legally appointed and qualified
representative of the estate of such Participant; or


 


(c)                                  any person deemed by the Committee to have
incurred expenses on behalf of or for the benefit of such Participant for which
such person should be reimbursed.


 


“Break in Service”.  The words “Break in Service” for Transferred
Employees shall have the same meaning as in the Plan provided, however, that if
as of December 31, 1984, service was disregarded under the provisions of
the Champion Plan, then paragraph 2.11(a) of the Plan shall not cause such
service to be taken into account.


 


“Early Retirement Age”.  The words “Early Retirement Age” for
Transferred Employees shall be as reflected in Section 2.18 of the Plan
unless one of the following is applicable:


 


In the case of a Transferred Employee who was first
employed by Champion prior to January 1, 1977, and who was covered under
the Champion Plan, the Early Retirement Age shall be age fifty-five (55).


 


In the case of a Transferred Employee who is not described in the
paragraph immediately above, who was not a Former St. Regis Employee (as
defined below), and who was an Employee of Champion before January 1,
1986, the Early Retirement Age shall be age fifty-five (55) and at least five
(5) Vesting Years.


 


85

















 


“Former Hoerner Waldorf Employee”.  A
Former Hoerner Waldorf Employee means a Participant who was employed by Hoerner
Waldorf Corporation on February 23, 1977.


 


“Former St. Regis Employee”. A Former St. Regis Employee means a
Participant who was employed by St. Regis Corporation on or after
November 20, 1984 and prior to its merger into Champion.


 


“Vesting Service”. Vesting Service prior to May 14, 1999 for a
Transferred Employee and a Former Champion Employee (as defined in the Plan)
shall be disregarded as follows:


 


Periods of Service before January 1, 1971, unless the individual
has had at least three (3) Vesting Years after December 31, 1970; and


 


Periods before January 1, 1989, if such service would have been
disregarded under the rules of the Champion Plan (or any plan which was merged
into the Champion Plan) relating to breaks in service or failure to complete a
required period of service within a specified period of time (whether or not
such rules are so designated) as such rules were in effect on the applicable
date prior to January 1, 1989.


 


“Years of Credited Service”. With regard to Noncovered Years of Credited
Service for a Transferred Employee, such Noncovered Years will be counted only
if, in addition to the conditions set forth in Section 2.50(a)(4) of the
Plan, the transfer to Salaried Employee status occurred on or after
January 1, 1975.


 


ARTICLE 4



 


Offset for Pre-1975 Plan Withdrawal Right Amount.


 


(A)                              General. If a Transferred Participant has withdrawn any of his Pre-1975 Plan
Withdrawal Right Amount, then his retirement benefit, computed under
Section 4.2(a) of the Plan shall be reduced by the then Actuarial
Equivalent of the aggregate amounts so withdrawn by him, subject to (B) below.


 


(B)                                Vested Terminated. If a Participant, to whom (A) above
applies, is vested terminated at the time the reduction is computed under (A)
above, then, solely for the purpose of determining the amount of such
reduction, there shall be added to any amount theretofore so withdrawn by him
interest at the rate of four percent (4%) per annum, compounded annually, from
the date of such prior withdrawal to the date as of which the amount of such
reduction is being computed. For the purpose of this Section, “Pre-1975 Plan
Withdrawal Right Amount” shall mean a Participant’s retirement benefit in an
amount equal to the portion of the Plan Assets attributable to Employer
contributions with respect to which he had a withdrawal right under the
Pre-1975 Plan at his retirement or termination of employment prior to
retirement determined on the basis that he shall continue to have such
withdrawal right under the Champion Plan.


 


86

















 


Offset for Certain Amounts Paid or Payable under
Champion International Corporation Savings Plan #077. If a Transferred Employee is entitled to a
benefit under Champion International Corporation Hourly Profit Sharing Plan
Number 063 (which was merged into the Champion International Corporation
Savings Plan #077) and if his period of participation thereunder also
constitutes Years of Credited Service with respect to him under the Plan, then
his annual retirement benefit computed under Section 4.2(a) of the Plan,
shall be reduced by the value of the annual retirement benefit under said Plan
Number 063 which is attributable to the contributions of the Employer, its
subsidiary and/or affiliated corporations. For purposes of the foregoing, the
Participant’s account under said Plan Number 063 which is attributable to the
contributions of the Employer, its subsidiaries and/or affiliated corporations,
valued as of the valuation date thereunder coinciding with or last preceding
his Normal Retirement Age, shall be multiplied by ten percent (10%) to
determine the annual retirement benefit attributable thereto; provided however,
if a Participant ceases to be a Salaried Employee prior to his Normal
Retirement Date, then such account shall be valued as of the valuation date
coinciding with or last preceding such cessation, interest shall be added
thereto at the rate of five percent (5%) (or such other rate as may be
effective for purposes of Section 41l(c)(2)(C) of the Code) per annum
compounded annually to such Participant’s Normal Retirement Date, and the sum
shall be multiplied by ten percent (10%) to determine the annual retirement
benefit attributable thereto.


 


Offset for Certain Account Under Champion
International Corporation Savings Plan #077.


 


(A)                              General. A Transferred Employee’s annual retirement benefit, computed under
Section 4.2(a) of the Plan, shall be reduced by:


 


(i)                                     the sum of:


 


(I)                                    his account balance, as of October 1,
1978, attributable to employer contributions under Champion International
Corporation Salaried Profit Sharing Plan Number 062 (which was merged into the
Champion International Corporation Savings Plan #077); plus


 


(II)                                interest, imputed at eight and one half
percent (8.5%) per year, compounded annually, from October 1, 1978 to his
Normal Retirement Date; divided by


 


(ii)                                  8.0946.


 


(B)                                Payment Prior to Normal Retirement Age. Anything in the Plan to the contrary
notwithstanding, if the payment of a Participant’s benefit commences prior to
Normal Retirement Age, then, for purposes of reducing his Accrued Benefit, the
following factors (interpolated on a straight line basis for full months) shall
be applied with respect to the offset under (A) above:


 


87

















 




	
  Age

  	
   

  	
  Factors

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  65

  	
   

  	
  1.0000

  	
   

  
	
  64

  	
   

  	
  .9000

  	
   

  
	
  63

  	
   

  	
  .8112

  	
   

  
	
  62

  	
   

  	
  .7320

  	
   

  
	
  61

  	
   

  	
  .6613

  	
   

  
	
  60

  	
   

  	
  .5981

  	
   

  
	
  59

  	
   

  	
  .5415

  	
   

  
	
  58

  	
   

  	
  .4908

  	
   

  
	
  57

  	
   

  	
  .4453

  	
   

  
	
  56

  	
   

  	
  .4043

  	
   

  
	
  55

  	
   

  	
  .3674

  	
   

  






 


Offset for Benefits Under St. Regis Corporation
Retirement Plan for Salaried Employees. A Transferred Employee’s annual retirement
benefit as determined in accordance with Section 4.2(a) of the Plan shall
have the part of benefit paid by the Champion Plan reduced by the Actuarial
Equivalent of any benefit to him under the terminated St. Regis
Corporation Retirement Plan for Salaried Employees.


 


Grandfathered Benefit for Pre-1975 Champion Plan
Participants.  If a
Transferred Employee is otherwise entitled to a benefit under the Champion
Plan, and he was a Participant in the Pre-1975 Plan on December 31, 1974,
then such benefit shall not be less than a monthly retirement benefit equal to
the monthly retirement benefit which he would have received under the Pre-1975
Plan if the Pre-1975 Plan had continued in effect and if he had continued to
receive such compensation as was taken into account in determining his
retirement income under the Pre-1975 Plan at an annual rate after 1974 equal to
his 1974 rate of compensation.


 


Grandfathered Benefits for Former Hoerner Waldorf
Employees.  If a
Transferred Employee is a Former Hoemer Waldorf Employee, then, at any time
prior to January 1, 1986, his Accrued Benefit shall not be less than his
monthly benefit determined under the Hoerner Waldorf benefit formula as set
forth in Exhibit One to this Addendum. (The Exhibit One to this Addendum
attached hereto is a copy of Appendix Two to the Champion International
Corporation Salaried Retirement Plan #001.) From and after January 1,
1986, his Accrued Benefit shall not be less than the sum of:


 


(a)                                   a benefit determined, as of December 31,
1985, under the Hoemer Waldorf benefit formula as set forth in Exhibit One of
the Addendum to this Plan on the basis of:


 


(1)                                  his Average Earnings as of the earlier of


 


(A)                              December 31, 1985, or


 


(B)                                age 65;


 


88

















 


(2)                                  his Social Security Benefits at age 65
determined on the basis of the following assumptions:


 


(A)                              he has level future earnings to age
fifty-five (55) (based on his Adjusted Earnings for 1985) and zero earnings
thereafter;


 


(B)                                if he is over age fifty (50) on
December 31, 1985, his Social Security Benefits are reduced by 1/15th
for each year under age sixty-five (65) on December 31, 1985 (subject to a
maximum reduction of twenty percent (20%); and


 


(C)                                if he is over age sixty-five (65) on
December 31, 1985, his Social Security Benefits at age sixty-five (65)
apply; plus


 


(b)                                 the product of (1) and (2) below where:


 


(1)                                  is equal to


 


(A)                              the benefit he would have at Normal
Retirement Age under the Hoerner Waldorf benefit formula as set forth in
Exhibit One of the Addendum to the Plan, determined on the basis of the
following assumptions:


 


(i)                                     his Average Earnings are determined for the
highest five (5) consecutive Plan Years from the calendar year of attainment of
age fifty-six (56) through the calendar year of attainment of Normal Retirement
Age, both inclusive;


 


(ii)                                  his Adjusted Earnings for 1986 and each
subsequent year are equal to the greater of his base rate of pay on
December 31, 1985 or his Adjusted Earnings for 1985;


 


(iii)                               his Social Security Benefits at age
sixty-five (65) are determined on the basis of:


 


(I)                                    level earnings for 1986 and each subsequent
year equal to the greater of his base rate of pay on December 31, 1985 or
his Adjusted Earnings for 1985;


 


(II)                                earnings for 1985 and prior years on the
basis of a seven percent (7%) backwards salary scale; and


 


(III)                            the Social Security Act as in effect on
December 31, 1985; minus


 


89

















 


(B)                                the amount determined under (a) above; and


 


(2)                                  is a fraction, not exceeding 1, the numerator
of which is his actual Years of Credited Service after December 31, 1985
and the denominator of which is the Years of Credited Service after
December 31, 1985 he would have if he separated from service at Normal
Retirement Age; plus


 


(c)                                  if he was a Participant in Champion
International Corporation Salaried Pension Plan Number 039 or Champion
International Corporation Salaried Pension Plan Number 061 on
September 27, 1979, the Actuarial Equivalent of any accrued benefit under
such plan as of September 27, 1979.


 


Grandfathered Benefits for Former St. Regis Employees.  If a Transferred Employee is a Former St.
Regis Employee, then subject to the offset under the Section of the
Addendum entitled Offset for Benefits
Under St. Regis Corporation Retirement Plan for Salaried Employees,  at
any time prior to January 1, 1986, his Accrued Benefit shall not be less
than his monthly benefit determined under the St. Regis benefit formula as set
forth in Exhibit Two to this Addendum. (The Exhibit Two to this Addendum
attached hereto is a copy of Appendix Three to the Champion International
Corporation Salaried Retirement Plan #001.) From and after January 1,
1986, his Accrued Benefit shall not be less than the sum of:


 


(a)                                  a benefit determined, as of December 31,
1985, under the St. Regis benefit formula as set forth in Exhibit Two; plus


 


(b)                                 the product of (1) and (2) below where:


 


(1)                                  is equal to:


 


(A)                              the benefit he would have at Normal
Retirement Age under the St. Regis benefit formula as set forth in Exhibit Two
of the Addendum. It is assumed that his Adjusted earnings for 1986 and each
year thereafter are equal to his Adjusted Earnings as of December 31,
1985; minus


 


(B)                                the amount determined under (a) above; and


 


(2)                                  is a fraction, not exceeding 1, the numerator
of which is his actual Years of Credited Service after December 31, 1985
and the denominator of which is the Years of Credited Service after
December 31, 1985 he would have if he separated from service at Normal
Retirement Age.


 


90

















 


ARTICLE 6


 


Termination of Employment.  A Transferred Employee who is entitled to a
benefit under the Champion Plan who has not met the requirements for Normal Retirement,
Early Retirement, or Postponed Retirement shall have his benefit reduced as
reflected in Section 6.4 of the Plan and in addition benefits accrued
prior to May 14, 1999 shall be reduced pursuant to the following
schedule for any period or periods during which the Participant is covered
by the Preretirement Survivor Annuity prior to May 14, 1999:


 




	
  Participant’s Age

  	
   

  	
  Reduction
  for Each

  Month of Coverage

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Less
  than 35

  	
   

  	
  0

  	
  %

  
	
  At
  least 35 but less than 45

  	
   

  	
  1/12 of .1

  	
  %

  
	
  At
  least 45 but less than 55

  	
   

  	
  1/12 of .2

  	
  %

  
	
  At
  least 55 but less than 65

  	
   

  	
  1/12 of .5

  	
  %

  
	
  65
  or older

  	
   

  	
  0

  	
  %

  






 


ARTICLE 7


 


Pre-1975 Champion Plan Withdrawal
Right.  This
provision applies to any Transferred Employee who will receive a benefit from
the Champion Plan.


 


(a)                                  Right to Withdraw. If, under the Pre-1975 Champion Plan, a
Transferred Employee had a right, at his retirement or termination of
employment prior to retirement, to withdraw a portion of the Champion Plan
Assets attributable to Employer contributions (which portion, if not so
withdrawn, would be used to provide a part of his retirement benefit under the
Champion Plan derived from Employer contributions), then, upon such Transferred
Employee’s retirement or termination of employment, he shall be entitled to
withdraw his Pre-1975 Champion Plan Withdrawal Right Amount in a lump sum;
provided however, he must also elect to withdraw his Voluntary Participant
Account if any. If a Transferred Employee’s nonforfeitable benefit under the
Champion Plan has a present value (determined in accordance with
Section 7.4(d)) of the Plan of more than $5,000, then a withdrawal
hereunder shall be subject to a waiver of the Qualified Joint and Survivor
Annuity (with respect to such withdrawal) under Section 7.2 of the Plan.


 


(b)                              Amount. The Pre-1975 Champion Plan Withdrawal Right Amount of a Transferred
Employee shall be a retirement benefit in an amount equal to the portion of the
Champion Plan assets attributable to Employer contributions with respect to
which he had a withdrawal right, under the Pre-1975 Champion Plan, at his
retirement or termination of employment prior to retirement (which portion if
not so withdrawn, would be used to provide a part of his retirement benefit
under the Champion Plan derived from


 


91

















 


Employer contributions), determined on the basis that he shall continue
to have such withdrawal right under the Champion Plan.


 


ARTICLE 8


 


DEATH
BENEFITS


 


Entitlement Under Provisions of the Champion Plan
Prior to May 14, 1999. The
Preretirement Survivor Annuity provisions under the Champion Plan will be
applicable to any Transferred Employees prior to May 14, 1999 if:


 


(A)                              the Transferred Employee and his Surviving
Spouse were married throughout the one (1) year period ending on the date of
the Transferred Employee’s death;


 


(B)                                the Transferred Employee has not elected to
waive the Preretiement Survivor Annuity;


 


(C)                                the Transferred Employee has met the
requirements reflected in Section 8.1(a) and (b) of the Plan.


 


Waiver of Preretirement Survivor Annuity.


 


(1)                                  General. A Transferred Employee may waive coverage of the Preretirement
Survivor Annuity, at any time during his Election Period under (3) below, if:


 


(A)                              the Participant’s benefits are reduced,
pursuant to the section of the Addendum entitled Termination of Employment in
Article 6, on account of the coverage of the Preretirement Survivor
Annuity; or


 


(B)                                the Participant desires the coverage, after
his attainment of Normal Retirement Age and before his Benefit Commencement
Date, of an optional survivor benefit pursuant to Section 8.2 of the Plan.


 


Such waiver must be in
writing and must specify the specific Beneficiary or Beneficiaries, if any, to
whom any death benefits under the Plan will be available.


 


(2)                                  Revocation. Any waiver under (1) above may be revoked at any time during the
Participant’s Election Period under (3) below. There shall be no limitation on
the number of such elections and revocations permitted during such Election
Period.


 


(3)                                  Election Period. For purposes of (1) and (2) above, the
Election Period shall be the period


 


92

















 


(A)                              beginning on the earlier of:


 


(i)                                     (I)                                    in the case of a Participant to whom in (1)
(A) above applies, the first day of the Plan Year in which he attains age
thirty-five (35), 


 


(II)                                in the case of a Participant described in
(1)(B) above, the first day of the Plan Year in which he attains Normal
Retirement Age; or


 


(ii)                                  the date of the Participant’s separation from
service; provided however, if the Participant returns to service, then any
election made prior to the first day of the Plan Year in which he attains age
thirty-five (35) shall be voided; and


 


(B)                                ending on the Participant’s date of death.


 


(4)                                  Written Explanation.


 


(A)                              The Committee shall provide to each
Participant, within the Applicable Period (defined below) and consistent with
such regulations as the Secretary of the Treasury may prescribe, a written
explanation of:


 


(i)                                     the terms and conditions of the Preretirement
Survivor Annuity;


 


(ii)                                  the Participant’s right to make, and the
effect of, an election under (1) above to waive the coverage of the
Preretirement Survivor Annuity;


 


(iii)                               the rights of the Participant’s Spouse under
(5) below;


 


(iv)                              the right to make, and the effect of, a revocation
of an election under (2) above; and


 


(v)                                 the eligibility conditions, material features
and relative values of any optional forms of benefit under the Plan.


 


(B)                                Applicable Period means, with respect to a Participant,
whichever of the following periods ends last:


 


(i)                                     the period beginning with the first day of
the Plan Year in which the Participant attains age thirty-two (32) and ending
with the close of the Plan Year preceding the Plan Year in which the
Participant attains age thirty-five (35); or


 


93

















 


(ii)                                  the period beginning one year prior to, and
ending one year after, the date the individual becomes a Participant.


 


In the case of a Participant
who separates from service before attaining age thirty-five (35), the
“Applicable Period” means in all events the period beginning one year before
the separation from service and ending one year after such separation; provided
that if such a Participant returns to service, the provisions of (i) and (ii) above
shall again apply.


 


(5)                                  Spousal Consent. A waiver under (1) above shall not be
effective with respect to a Spouse of a Participant unless:


 


(A)                              such Spouse consents in writing to such
election, and such Spouse’s consent:


 


(i)                                     acknowledges the effect of such election,


 


(ii)                                  acknowledges the specific Beneficiary or
Beneficiaries, if any, to whom any death benefits under the Plan will be
payable, and


 


(iii)                               is witnessed by a Plan representative or a
notary public; or


 


(B)                                it is established to the satisfaction of a
Plan representative that the consent required under (A) above may not be
obtained because there is no Spouse, because the Spouse cannot be located, or
because of such other circumstances as may be provided in regulations of the
Internal Revenue Service.


 


Post
Retirement Death Benefits


 


Former St. Regis Employees. The Post-Retirement Death Benefit with
respect to a Transferred Employee in the Plan and who was a former St. Regis
Employee and who at any time from October 1, 1985 through
December 31, 1985, had attained Early Retirement Age, shall be the
greatest of:


 


(A)                              $10,000,


 


(B)                                the amount determined under (1) or (2) of
Section 8.3 of the Plan, whichever is applicable, or


 


(C)                                (i)                                     if he dies at any time prior to July 1
of the calendar year following the calendar year in which he retires, the
amount determined by subtracting the Adjusted Amount from the Participant’s
Group Coverage Amount;


 


94

















 


(ii)                                  if he dies at any time on or after
July 1 of the calendar year following the calendar year in which he
retires but before July 1 of the second calendar year following the
calendar year in which he retires, the amount determined by subtracting the
product of two (2) times the Adjusted Amount from the Participant’s Group
Coverage Amount;


 


(iii)                               if he dies at any time on or after
July 1 of the second calendar year following the calendar year in which he
retires but before July 1 of the third calendar year following the
calendar year in which he retires, the amount determined by subtracting the
product of three (3) times the Adjustment Amount from the Participant’s Group
Coverage amount,


 


(iv)                              if he dies at any time on or after
July 1 of the third calendar year following the calendar year in which he
retires, the amount determined by subtracting the product of four (4) times the
Adjustment Amount from the Participant’s Group Coverage Amount.


 


As used in this subparagraph, the following terms, when capitalized,
shall have the following meanings:


 


“Adjustment Amount” means, with respect to a Participant who is a
former St. Regis Employee, the amount determined by subtracting fifty percent
(50%) of the first $100,000 of the Participant’s Base Rate from the
Participant’s Group Coverage Amount and by multiplying the resulting amount by
..25.


 


“Base Rate” means, with respect to a Participant who is a former St.
Regis Employee, the annual rate of pay for such Participant as of
September 30, 1985 (not including overtime or any other special or
supplemental compensation) except that with respect to a Participant who is
compensated in whole or in part by commissions, “Base Rate” means the regular
pay (not including overtime or any other special or supplemental compensation)
and commissions actually received in 1984.


 


“Group Coverage Amount” means, with respect to a Participant who is a
former St. Regis Employee, the face amount, as of September 30, 1985 of
the Participant’s life insurance coverage under the active group life insurance
provided by the Employer (including that part of the face amount attributable
to premiums paid by the Participant).


 


For purposes of this subparagraph, a Participant who retires after his
Normal Retirement Date shall be deemed to have retired on his Normal Retirement
Date.


 


Offset Provision. Notwithstanding any provisions in
Section 8.3 of the Plan under paragraphs (1), (2), and (3) to the
contrary, any Post-Retirement Death Benefit payable to a Transferred Employee
shall be offset by any death benefit payable with respect to such Participant from
the Champion International Corporation Executive Insurance Plan #700.


 


95

















 


(4)                                  for a Participant who became an employee of
Hoerner Waldorf Corporation on June 9, 1973, as a result of its
acquisition of the Columbus, Indiana plant from Weyerhauser Company, the amount
of past service benefit as stated in Plan Number 038 and expressed as an annual
amount; or 


 


(b)                                 his “pension credits” as determined under
Plan Number 038 as of December 31, 1977 (December 31, 1978 with
respect to Little Rock, Arkansas Organized Salaried Employees) and expressed as
an annual amount.


 


2.                                       Deduction for Other Pension Payments. Notwithstanding the foregoing provisions,
the amounts otherwise computed thereunder shall be reduced by the amount
(expressed on a comparable basis that is an Actuarial Equivalent) of the
pension, if any, to which the Participant is entitled under any other fixed
benefit pension plan that meets the requirements of section 401 (a) of the
Code, and that was financed in whole or in part by the Employer or a
predecessor or affiliated company, but only to the extent such other pension is
attributable to employer contributions and to the same period of service.


 


3.                                       Profit
Sharing Offset. “Profit Sharing Offset” shall mean one-half (1/2) of the
lesser of the amounts determined in accordance with the following paragraphs:


 


(a)                                     The amount determined to be the amount of an
annuity, for the life of the Participant only with payments commencing on the
first day of the month following his Normal Retirement Date, that would be
provided by application on October 31, 1972 of an amount equal to the
value of the Participant’s account on such date determined under the provisions
of the Hoerner Waldorf Corporation Supplemental Profit Sharing Plan assuming
interest thereafter at five percent (5%) per annum and mortality after his
Normal Retirement Date in accordance with the 1951 Group Annuity Projection
Scale C to 1960; or


 


(b)                                    The amount determined to be the amount of an
annuity, for the life of the Participant only with payments commencing on the
first day of the month following his Normal Retirement Date, that would be
provided by application on October 31, 1972 of an amount equal to the
value of the Participant’s account on such date under the provisions of the
Hoerner Waldorf Corporation Supplemental Profit Sharing Plan plus any
accumulated earnings or minus any accumulated losses thereon, based on the
cumulative quarterly appraisal factors for Champion International Corporation
Salaried Profit Sharing Plan Number 062, through the last day of the quarter
immediately preceding or coincident with the earlier of his termination of
employment or Normal Retirement Date and assuming interest thereafter at five
percent (5%) per annum and mortality after his Normal Retirement Date in
accordance with the 1951 Group Annuity Projection Scale C to 1960.


 


4.                                       Intermountain
Pension Service. For purposes of Section 1 of this Appendix, in the
case of a Participant with continuous employment with The Intermountain
Company, Hoerner Waldorf Corporation, and Champion International Corporation,
the following shall apply with


 


96

















 


respect to any benefits that have been or may become payable on account
of retirement or other termination of employment from the Employer:


 


(a)                                  In determining such a Participant’s years of
Credited Service under Plan Number 038, he shall receive credit for service
with The Intermountain Company prior to April 1, 1973.


 


(b)                                 Any additional amount resulting from the
application of (a) above shall be reduced by the value of the retirement
benefit which is derived from the portion of the Participant’s balance under
Champion International Corporation Salaried Profit Sharing Plan Number 062 which
is attributable to The Intermountain Company Profit Sharing Retirement Trust.
For purposes of the foregoing, such portion of the Participant’s account under
said Plan 062, valued as of the valuation date thereunder coinciding with or
last preceding his Normal Retirement Date, shall be multiplied by ten percent
(10%) to determine the annual retirement benefit attributable thereto; provided
however, if a Participant ceases to be an Employee prior to his Normal
Retirement Date, then such portion shall be valued as of the valuation date
coinciding with or last preceding such cessation, interest shall be added
thereto at the rate of five percent (5%) (or such other rate as may be
effective for purposes of section 41l(c)(2)(D) of the Code) per annum compounded
annually to such Participant’s Normal Retirement Date, and the sum shall be
multiplied by ten percent (10%) to determine the annual retirement benefit
attributable thereto.


 


5.                                       Employees of Hoerner Waldorf Pan American Bag
Co., Inc. For purposes of
this Appendix, a Participant employed by Hoerner Waldorf Pan American Bag Co.,
Inc. shall be deemed to have been employed by Hoerner Waldorf Corporation and,
after its merger into Champion International Corporation, by Champion
International Corporation from the later of his latest date of hire by Hoerner
Waldorf Pan American Bag Co., Inc. or November 1, 1973.


 


97

















 


EXHIBIT TWO TO THE ADDENDUM

TO THE

RETIREMENT PLAN FOR EMPLOYEES OF BLUE RIDGE PAPER PODUCTS INC.


 


ST. REGIS BENEFITS


 


1.                                       Formula. A Participant’s St. Regis benefit shall be an annual benefit, in the
form of a single life annuity, equal to:


 


(a)                                  for service prior to July 1, 1973, the
sum of


 


(1)                                  (A)                              his “past service” as defined in Plan #080 times


 


(B)                                the sum of


 


(i)                                     0.8 percent of his highest five year average
Adjusted Earnings not in excess of $7,800 plus


 


(ii)                                  1 percent of any such excess; plus


 


(2)                                  (A)                              his “contributory service” as defined in Plan #080 times


 


(B)                                the sum of


 


(i)                                     1.15 percent of his highest five (5) year
average Adjusted Earnings not in excess of $7,800 plus


 


(ii)                                  1.5 percent of any such excess; plus


 


(b)                                 for service after June 30, 1973:


 


(1)                                    his “credited service” as defined in Plan
#080 times


 


(2)                                    the difference between:


 


(A)                              1.5 percent of his highest five (5) year
average Adjusted Earnings and


 


(B)                                1.25 percent of the primary old age insurance
benefit which a Participant who is fully insured would be entitled to receive
under the Federal Social Security Act upon application for benefits at age
sixty-five (65), based on the Federal Social Security Act as in effect on the
date of determination without any increase in the wage base or benefit levels
that take effect after that date, and assuming that his Adjusted Earnings at
the time the determination


 


98

















 


is made remain the same until age sixty-five (65), that his
compensation increased prior thereto at the rate of seven percent (7%) a year,
and that he has no earnings after age sixty-five (65) which would diminish or
eliminate his Social Security benefits; plus


 


(c)                                  the excess, if any, of


 


(1)                                  the amount of retirement income (in the form
of a single life annuity) under the provisions of any retirement or pension
plan of a “Class II (a) Predecessor” or a “Class II (b) Predecessor” as defined
in Plan #080 over


 


(2)                                  the benefit determined under (a) and (b)
above with respect to the Participant’s period of employment with such
Predecessor; minus


 


(d)                                 the Actuarial Equivalent of any retirement income
received under any such Predecessor’s plan or plans with respect to service
taken into account under Plan #080.


 


2.                                       Minimum. The benefit computed under Section 1 above shall not be less than
$10 per month for each year in a Participant’s “period of service” as defined
in Plan #080.


 


99

















 


EXHIBIT
A


 


RETIREMENT PLAN FOR SALARIED EMPLOYEES

OF BLUE RIDGE PAPER PRODUCTS INC.


 


The
purpose of this Exhibit A is to list all adopting employers and the type of
Service recognized by the Retirement Plan for Salaried Employees of Blue Ridge
Paper Products Inc.


 


	
  Name of Adopting

  Employer

  	
   

  	
  Type of
  Service

  Recognized

  	
   

  	
  Date of
  Service

  Recognized

  
	
  Westvaco

  	
   

  	
  Eligibility
  Service

  

  Vesting Service

  

  Credited Service

  	
   

  	
  Last
  date of hire with Westvaco

  

  Last date of hire with Westvaco

  

  Date of acquisition
  (          )

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Champion International

  	
   

  	
  Eligibility
  Service

  

  Vesting Service

  

  Credited Service

  	
   

  	
  Last
  date of hire with Champion International

  

  Last date of hire with Champion International

  

  Last date of hire with Champion International

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ST. Regis Corporation

  	
   

  	
  Eligibility
  Service

  

  Vesting Service

  

  Credited Service

  	
   

  	
  Last
  date of hire with St. Regis

  

  Last date of hire with St. Regis

  

  Last date of hire with St. Regis

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Hoerner Waldorf Corporation

  	
   

  	
  Eligibility
  Service

  

  Vesting Service

  

  Credited Service

  	
   

  	
  Last
  date of hire with Hoerner Waldorf

  

  Last date of hire with Hoerner Waldorf

  

  Last date of hire with Hoerner Waldorf

  



 


100

















 


M-EXHIBIT 2


 


RESOLUTIONS
OF

BOARD OF DIRECTORS OF

BLUE RIDGE PAPER PRODUCTS INC.


 


WHEREAS, on May 14, 1999 (the “Closing Date”), Blue Ridge Paper Products Inc.
(the “Company”) purchased the assets of the “Canton System” from Champion
International Corporation (“Champion”); and


 


WHEREAS, immediately prior to the Closing Date, salaried employees of the Canton
System participated in the Champion International Corporation Salaried
Retirement Plan #001, a tax-qualified pension plan (the “Champion Plan”); and


 


WHEREAS, it is desirable for the Company to adopt its own tax-qualified pension
plan, for the salaried employees of the Company, which plan will be
substantially similar to the Champion Plan as in effect immediately prior to
the Closing Date; and


 


WHEREAS, it is further desirable that this Company pension plan provide that the
total pension benefit, from the Champion Plan and the Company pension plan
considered together, for each salaried employee of the Company who participated
in the Champion Plan immediately prior to the Closing Date shall be identical
to the pension benefit that person would have received under the Champion Plan,
as in effect immediately prior to the Closing Date, had such person instead
remained an employee of Champion.


 


NOW THEREFORE, be it


 


RESOLVED, that, subject to the receipt of a favorable determination letter from
the Internal Revenue Service (“IRS”), the Company hereby adopts the Retirement
Plan for Salaried Employees of Blue Ridge Paper Products, Inc. (the “Salaried
Pension Plan”), effective as of May 14, 1999, substantially in the form
described in Exhibit A attached hereto; and be it further


 


RESOLVED, that the Salaried Pension Plan, as so adopted (and as described,
substantially in the form set out in Exhibit A hereto) shall not apply with
respect to any salaried employee of the Company who has been (either during
such person’s period of employment with the Company or Champion) promoted from
hourly employee status to salaried employee status (or who may be so promoted
by the Company in the future), it being understood that the inclusion of each
such person under the Salaried Pension Plan (and the terms and conditions on
which each such person shall so participate) shall be the subject of future
action by the Company; and be it further


 

















 


RESOLVED, that the Board of Directors (the “Board”) hereby appoints Wachovia
Bank, N.A., (“Wachovia”) as the trustee under the Salaried Pension Plan,
effective as of May 14, 1999; and be it further


 


RESOLVED, that, so as to facilitate the efficient administration and operation of
the Salaried Pension Plan and the trust agreement with Wachovia, the Board
hereby establishes a committee, to be known as the Employee Benefits Committee,
to be comprised of at least two officers or employees of the Company (or of
Blue Ridge Holding Corp.), each of whom shall be appointed by the Board, and
which committee shall be the “Named Fiduciary,” for purposes of the Employee
Retirement Income Security Act of 1974, as amended, (“ERISA”), under the
Salaried Pension Plan; and be it further


 


RESOLVED, that, effective the date hereof, the Board hereby appoints Thomas H.
Carter and Richard Lozyniak as the initial members of the Employee Benefits
Committee; and be it further


 


RESOLVED, that each officer of the Company (and of Blue Ridge Holdings Corp.) be,
and each of them individually hereby is, authorized and directed to (i) prepare
the actual text of the Salaried Pension Plan document reflecting the terms of
the Plan as set forth in Exhibit A, together with any changes to the Salaried
Pension Plan, additions thereto and deletions therefrom as such officer
determines is necessary or advisable to effectuate the establishment of the
Salaried Pension Plan, (ii) execute the trust agreement with Wachovia, (iii)
execute and deliver such other documents and agreements (including, but not
limited to, any administrative services or recordkeeping agreement and any fee
agreement), incur such fees and expenses on behalf of the Company, and take
such other actions (including, but not limited to, submitting the Salaried
Pension Plan to the IRS for a favorable determination letter and making such
further changes to the Salaried Pension Plan as the IRS may require as a
condition to the issuance of such favorable determination), as such officer may
determine is necessary or advisable to carry out the purposes and intent of the
foregoing resolutions, such officer’s taking of any of these aforementioned
actions to be conclusive evidence of such officer’s approval thereof; and be it
further


 


RESOLVED, that the Board hereby confirms, ratifies and approves all actions taken
by officers and employees of the Company in furtherance of the purposes and
intent of the foregoing resolutions.


 

















 


Exhibit A


 


Retirement
Plan for Salaried Employees of

Blue Ridge Paper Products Inc.


 


Description
of Significant Terms and Conditions


 


	
  Name:

  	
  Retirement
  Plan for Salaried Employees of Blue Ridge Paper Products Inc. (the “Plan”).

  
	
   

  	
   

  
	
  Effective

  	
   

  
	
  Date:

  	
  May
  14, 1999.

  
	
   

  	
   

  
	
  Eligible

  	
   

  
	
  Employees:

  	
  Each
  employee of Blue Ridge Paper Products Inc. and its participating subsidiaries
  and affiliates (the “Employer”), excluding any person who is (i) compensated
  on an hourly basis, (ii) a member of a collective bargaining unit, (iii) a
  nonresident alien who receives no earned income from the Employer which
  constitutes income from sources within the United States, (iv) a nonresident
  alien on temporary assignment in the United States, (v) designated by the
  Employer as a leased employee, independent contractor or consultant,
  regardless of whether such person may be held to be a common law employee of
  the Employer by a court, the Internal Revenue Service, or any other relevant
  federal, state or local governmental authority or agency, (vi) any person not
  otherwise described in (v) above who, without regard to such person’s status
  by the Employer, is otherwise a “leased employee,” within the meaning of
  Section 414(n) of the Internal Revenue Code, and (vii) any employee who
  is excluded from benefit coverage as part of an employment agreement or
  contract.

  
	
   

  	
   

  
	
  Participation:

  	
  Each
  Eligible Employee who (i) was a participant in the Champion International
  Corporation Salaried Retirement Plan #001 on May 13, 1999 (such plan as in
  effect on that date being hereafter referred to as the “Champion Plan”), (ii)
  was actively employed by Champion International Corporation (or one of its
  subsidiaries or affiliates on that date) (collectively, “Champion”) and (iii)
  became a salaried employee of the Employer on May 14, 1999 (a person who met
  all three conditions being referred to as a “Transferred Employee”) shall
  become a participant in the Plan, effective May 14, 1999.

  
	
   

  	
   

  
	
   

  	
  Each
  other Eligible Employee shall become a participant in the Plan on the first
  day of the month coinciding with or next following the date on which such
  person is credited with at least one “Eligibility Year” (as that

  



 

















 


	
   

  	
  term
  is defined under the Champion Plan”)), but based on service with the
  Employer. In addition, in the case of a person who was actively employed by
  Champion, as a salaried employee, on May 13, 1999, (ii) became a salaried
  employee of the Employer on May 14, 1999 but (iii) was not a participant in
  the Champion Plan on May 13, 1999 (a person who met all three conditions
  being referred to as a “Former Champion Employee”), such person’s employment
  with Champion prior to May 14, 1999 shall also be taken into account in
  determining when such person has completed the required “Eligibility Year”
  under the Plan, to the same extent that such service would have been counted
  in determining an “Eligibility Year” under the Champion Plan had that person
  instead remained a Champion employee.

  
	
   

  	
   

  
	
  Vesting
  Schedule:

  	
  Same
  as the vesting schedule under the Champion Plan, with years of “vesting
  service” under the Plan being determined in same manner as under the Champion
  Plan, but based on service with the Employer.  In addition, in the case of a Transferred Employee or a Former
  Champion Employee, such person’s employment with Champion prior to May 14,
  1999 shall also be taken into account in determining such person’s “vesting
  service” under the Plan, to the same extent as that such service would have
  been counted under the Champion Plan in determining “vesting service” under
  the Champion Plan had that person instead remained a Champion employee.

  
	
   

  	
   

  
	
  Benefit
  Formula:

  	
  Same
  as the benefit formula which would apply under the Champion Plan to a person
  who first became a participant in the Champion Plan on May 1, 1999. In
  applying this benefit formula under the Plan, years of credited service and
  compensation shall be determined in substantially the same manner as under
  the Champion Plan, but based on service and compensation with the Employer.
  In addition, in the case of a Former Champion Employee, such person’s service
  with, and compensation from, Champion prior to May 14, 1999 shall also be
  taken into account under the Plan’s benefit formula, to the same extent as
  that such service and compensation would have been taken into account under
  the Champion Plan had such person instead remained a Champion employee and
  ultimately become a participant in the Champion Plan.

  
	
   

  	
   

  
	
  Retirement

  	
   

  
	
  Dates:

  	
  Same
  as under the Champion Plan.

  
	
   

  	
   

  
	
  Benefit
  Reduction

  	
   

  
	
  for
  early retirement:

  	
  Same
  as under the Champion Plan.

  



 

















 


	
  Forms
  of

  	
   

  
	
  Benefits:

  	
  The
  normal forms of benefit shall be the same as under the Champion Plan. The
  optional forms of benefit shall be substantially the same as the Champion
  Plan.

  
	
   

  	
   

  
	
  Death
  Benefits:

  	
  Substantially
  the same as under the Champion Plan.

  
	
   

  	
   

  
	
  Special
  Rules for

  	
   

  
	
  Transferred

  	
   

  
	
  Employees:

  	
  So
  as to provide each Transferred Employee with the same total pension benefit
  such employee would have received had such person instead remained a Champion
  employee, each Transferred Employee’s benefit under the Plan shall be equal
  to:

  
	
   

  	
   

  
	
   

  	
  (i)

  	
  the
  amount determined under the above benefit formula, but treating, for purposes
  of this formula, all whole or partial “years of credited service” and
  “compensation” which were otherwise taken into account for that person under
  the Champion Plan, as of May 13, 1999 as “years of credited service” with,
  and “compensation” from, the Employer, but the resulting benefit amount
  reduced by

  
	
   

  	
   

  	
   

  
	
   

  	
  (ii)

  	
  the
  amount of the retirement benefit which such person had earned under the
  Champion Plan benefit formula as of May 13, 1999.

  



 

















 


(2)                                 Retirement Plan for Salaried Employees of Blue Ridge
Paper Products Inc.


 


WHEREAS, the Board of Directors of Blue Ridge Paper
Products Inc. (the “Board”) has previously established the Employee Benefits
Committee under the Retirement Plan for Salaried Employees of Blue Ridge Paper
Products, Inc. (the “Salaried Pension Plan”); and


 


WHEREAS, the Board has previously appointed Wachovia
Bank, N.A. (“Wachovia”) as the trustee under the trust established in
connection with the Salaried Pension Plan (the “Salaried Pension Plan Trust”);
and


 


WHEREAS, to facilitate the efficient administration
and operation of the Salaried Pension Plan and the trust agreement with
Wachovia, the Board by resolution dated February 24, 2000 established the
Employee Benefits Committee, comprised of at least two officers or employees of
the Company (or of Blue Ridge Holding Corp.), and which committee is the “Named
Fiduciary,” for purposes of the Employee Retirement Income Security Act of
1974, as amended, (“ERISA”), under the Salaried Pension Plan; and


 


WHEREAS, pursuant to Section 13.2(a) of the
Salaried Pension Plan, the Board desires to appoint a new committee; and


 


NOW
THEREFORE, BE IT RESOLVED, that, effective November 27, 2000, the Board hereby appoints
Richard Lozyniak, John B. Wadsworth and Bonnie G. Blackley as the members of
the Employee Benefits Committee; and


 


FURTHER
RESOLVED, that the
acts and deeds of the proper officers of the Corporation necessary to carry out
the intent and purpose of these resolutions be, and the same hereby are,
ratified, confirmed, and adopted as the acts and deeds of the Corporation.


 


3

















 


FIRST AMENDMENT TO THE


 


RETIREMENT PLAN FOR SALARIED EMPLOYEES

OF BLUE RIDGE PAPER PRODUCTS, INC.


 


The Retirement Plan for Salaried Employees of Blue Ridge Paper
Products, Inc. is hereby amended by the First Amendment as follows:


 


1.                                       Section 2.6 “Annuity Starting Date” is
amended be deleting this Section in its entirety and substituting the
following therefor:


 


2.6                                 “Annuity Starting Date” means the first day of the first period in
which all events have occurred which entitle the Participant to a benefit
payable as an annuity or any other form.


 


2.                                       Section 7.4(b) Consent to Early
Payment is amended by adding the following to the end of
subsection 7.4(b)(2):


 


A Participant’s waiver and the spouse’s consent waiver of a qualified
joint and survivor annuity or a qualified preretirement survivor annuity shall
not be effective unless:


 


(a)          the Participant’s spouse consents in writing to the election;


 


(b)         the election designates a specific alternate beneficiary, including any
class of beneficiaries or any contingent beneficiaries, which may not be
changed without spousal consent (or the spouse expressly permits designations
by the Participant without any further spousal consent);


 


(c)          the spouse’s consent acknowledges the effect of the election; and


 


(d)         the spouse’s consent is witnessed by a Plan representative or notary
public.


 


Additionally, a Participant’s waiver of the qualified joint and
survivor annuity will not be effective unless the election designates a form of
benefit payment which may not be changed without spousal consent (or the spouse
expressly permits designations by the Participant without any further spousal
consent). If it is established to the satisfaction of a Plan representative
that such written consent may not be obtained because there is no spouse or the
spouse cannot be located, a waiver that does not have spousal consent will be
deemed a qualified election.


 


Any consent by a spouse obtained under this provision (or the
establishment that the consent of a spouse may not be obtained) shall be
effective only with respect to such spouse. A consent that permits designations
by the Participant without any requirement of further consent by such spouse
must acknowledge that the spouse has the right to limit consent to a specific
beneficiary, and a specific form of benefit where applicable, and that the
spouse voluntarily elects to relinquish either or both of such rights. A
revocation of a prior waiver may be made by a Participant without the consent
of the spouse at any time prior to the commencement of benefits. The number of
revocations shall not be limited. No consent obtained under this provision shall
be valid unless the Participant has received notice as indicated above and such
notice gives a written explanation of:


 

















 


(i)                                     the terms and conditions of a qualified joint
and survivor annuity;


 


(ii)                                  the Participant’s right to make and the
effect of an election to waive the qualified joint and survivor annuity form of
benefit;


 


(iii)                               the rights of a Participant’s spouse;


 


(iv)                              the right to make, and the effect of, a
revocation of a previous election to waive the qualified joint and survivor
annuity; and


 


(v)                                 the relative values of the various optional
forms of benefit under the Plan.


 


2.                                       Section 7.4(d) Cash-out Distributions
is amended by adding the following sentence to the end of the last paragraph of
this subsection:


 


If either the value of a Participant’s vested Accrued benefit derived
from Employer and Employee  contributions
exceeds $5,000 or there are remaining payments to be made with respect to a
particular distribution option that previously commenced, and the Accrued
Benefit is immediately distributable, the Participant and the Participant’s
spouse (or where either the Participant or the spouse has died, the survivor)
must consent to any distribution of such Accrued Benefit.


 

















 


CERTIFICATE OF RESOLUTIONS


OF THE BOARD OF DIRECTORS


OF BLUE RIDGE PAPER PRODUCTS, INC.


 


 


                I certify that I am the duly elected
Secretary of Blue Ridge Paper Products, Inc. and that the following are true
and correct copies of resolutions duly adopted by the Board of Directors of
Blue Ridge Paper Product, Inc. (hereinafter referred to as the “Corporation”).


 


                WHEREAS, the Corporation established the
Retirement Plan for Salaried Employees of Blue Ridge Products, Inc.
(hereinafter referred to as the “Plan”), effective May 14, 1999; and


 


                WHEREAS, the IRS has issued a favorable
determination letter with regard to the Plan; and


 


                WHEREAS, the Corporation wishes to amend the
Plan to bring the Plan into compliance with the Community Renewal Tax Relief
Act of 2000 and to add language requested by the Trustee to the Plan.


 


                NOW, THEREFORE, IT IS RESOLVED, that the
Corporation approves the Second Amendment to the Plan and authorizes any
actions that need to be taken by the officers of the Corporation to make the
Second Amendment a part of the Plan.


 


                IN WITNESS WHEREOF, the undersigned has set
his hand this the 15th day of February, 2002.


 


 


	
   

  	
   

  	
  BLUE RIDGE
  PAPER PRODUCTS, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  /s/ John
  Stevens

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Assistant
  Secretary

  



 


 

















 


SECOND AMENDMENT TO THE


 


RETIREMENT PLAN FOR SALARIED EMPLOYEES

OF BLUE RIDGE PAPER PRODUCTS, INC.


 


The Retirement Plan for Salaried Employees of Blue Ridge Paper
Products, Inc. is hereby amended by the Second Amendment as follows:


 


1.                                       Section 2.2(a) “Actual Earnings” is
amended by adding a new subparagraph (4)(C) as follows:


 


(C)                                effective January 1, 2001, an election
that is made pursuant to Section 132(f)(4) of the Code.


 


2.                                       Section 2.23 “Employee” is amended be
adding a sentence to the end of the second paragraph as follows:


 


Compensation for purposes of determining the ten percent (10%) employer
contribution shall be as defined in Section 415©(3) of the Code, but
including amounts contributed pursuant to a salary reduction agreement which
are excludable from the employee’s gross income under Section 125,
Section 402(e)(3), Section 402(h)(l)(B), Section 403(b), and
effective January 1, 2001, Section 132(f)(4).


 


3.                                       Section 10.1 (c) “Compensation”
is amended by deleting the last sentence in this subsection and
substituting the following therefor:


 


Compensation shall include any elective deferral, as defined in
Section 402(g)(3) of the Code, and any amount contributed or deferred by
the Employer at the Employee’s election that is not includible in the
Employee’s gross income under Section 125, 457, or effective
January 1, 2001, 132(f)(4) of the Code.


 


4.                                       Article 13 is amended by adding a new
Section 13.7 to read as follows:


 


13.7                           Directed Trustee. The Trustee shall be a directed trustee
only, with no discretionary authority or responsibility, with respect to the
assets of the Plan allocated or allocable to the accounts. The Committee, as a
Named Fiduciary, shall be solely responsible for the investment of the assets
of the Plan allocated or allocable to the accounts (except as provided more
specifically in paragraph (a) immediately below). Without limitation, the Committee
as a Named Fiduciary:


 


(a)                                  shall be responsible for investing such
assets and voting proxies of such assets except to the extent that such
investment responsibility is delegated to one or more investment managers
(other than the Trustee) under Section 403(a)(2) of ERISA;


 


(b)                                 shall, to the extent that Participants and
their Beneficiaries are given the right to direct the investment of their
accounts, be the Fiduciary to whom Participants and Beneficiaries are entitled
to give such investment directions (by directing the Trustee or otherwise);


 

















 


(c)                                  shall be responsible for any loss, or by
reason of any breach, which results from the Participant’s or Beneficiary’s
exercise of control over the accounts, except to the extent that
Section 404(c) of ERISA provides otherwise; and


 


(d)                                 shall be responsible for determining whether
the documents are instruments governing the investment of the assets allocated
or allocable to the accounts are consistent with the provisions of Titles I and
IV of ERISA notwithstanding such documents and instruments.


 

















 


CERTIFICATE OF RESOLUTIONS


OF THE BOARD OF DIRECTORS


OF BLUE RIDGE PAPER PRODUCTS, INC.


 


                I certify that I am the duly elected
Secretary of Blue Ridge Paper Products, Inc. and that the following are true
and correct copies of resolution duly adopted by the Board of Directors of Blue
Ridge Paper Product, Inc. (hereinafter referred to as the “Corporation”).


 


                WHEREAS, the Corporation established the
Retirement Plan for Salaried Employees of Blue Ridge Paper Products, Inc.
(hereinafter referred to as the “Plan”), effective May 14, 1999; and


 


                WHEREAS, the Corporation requested a
determination from the Internal Revenue Service (hereinafter referred to as the
“IRS”) that the Plan is a qualified plan; and


 


                WHEREAS, the Internal Revenue Service
requested certain changes to the Plan; and


 


                                                WHEREAS,
The Corporation made these changes to the Plan and presented said changes in
proposed from the IRS in the form of the First Amendment; and


 


                WHEREAS, the IRS has issued a favorable
determination letter with regard to the Plan and now the Corporation whishes to
authorize the adoption of the First Amendment to the Plan.


 


                NOW, THEREFORE, IT IS RESOLVED, that the
Corporation approves the First Amendment to the Plan and authorizes any actions
that need to be taken by the officers of the Corporation to make the First
Amendment a part of the Plan.


 


IN WITNESS WHEREOF, the
undersigned has set his hand this the 15th day of February, 2002.


 


	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  BLUE RIDGE
  PAPER PRODUCTS, INC.

  
	
   

  	
   

  
	
   

  	
  /s/ John
  Stevens

  
	
   

  	
  Assistant
  Secretary

  
	
   

  	
   

  



 


 

















 


M-EXHIBIT A


 


RESOLUTION OF


BOARD OF DIRECTORS OF


BLUE RIDGE PAPER PRODUCTS INC.


 


                WHEREAS, the Board
of Directors of Blue Ridge Paper Products Inc. (the “Board”) has previously
established the Retirement Plan for Salaried Employees of Blue Ridge Paper
Products, Inc. (the “Plan”); and


 


                WHEREAS, the Corporation wishes to
authorize the adoption of the Third Amendment to the Plan.


 


                NOW THEREFORE, be it


 


                RESOLVED, that the Board hereby confirms,
ratifies and approves of all actions taken by an officer or employee of the
Corporation (or of Blue Ridge Holding Corp.) in furtherance of the purposes and
intent of the foregoing resolutions.


 


                FURTHER RESOLVED, that the Retirement Plan
for Salaried Employees of Blue Ridge Paper Products Inc. is hereby amended by
the Third Amendment as follows:


 


1.             Section 2.2 (a) and
(b) “Actual Earnings” of Article 2, Definitions is amended by deleting
this Section in its entirety and substituting the following therefore:


 


                2.2           (a)           “Actual
Earnings”, with respect to a Participant for a Plan Year, means the
following, subject to (b), (c), (d) and (e) below:


 


                The amount paid by the Employer to such
Participant during such Plan Year equal to the total of base pay, any incentive
plan awards, any lump sum salary adjustment, any profit sharing, any overtime,
any commissions, any shift differential, the amounts deferred pursuant to
Section III and/or a plan subject to section 125 of the Code.


 


                2.2           (b)           "Actual
Earnings", with respect to a Participant for a Plan Year, excludes the
following:


 


Any relocation gross up, any relocation bonus, any severance, any
tuition, any retention bonus, any sign on bonus, any performance awards, any
vacation in lieu funds, expenses and reimbursements of all types, Employer
contributions to the Plan and other benefit plans of the Employer, and any
other special or extraordinary compensation as decided by the Board. If such
special or extraordinary compensation is excluded or included by the Board, the
Plan will be amended to reflect such exclusion or inclusion.


 


2.             Section 2.7(d) will be deleted in its entirely.


 


3.             All benefits earned
before the adoption date of this amendment will be no less than the benefits
earned under the Plan as written before this amendment.


 

















 


BLUE RIDGE PAPER PRODUCTS INC.


 


CERTIFICATE OF CORPORATE
RESOLUTION


 


                The
undersigned Assistant Secretary of Blue Ridge Paper Products Inc., a Delaware
Corporation (the "Corporation"), hereby certifies that the resolution
(see attached M-Exhibit A) was duly adopted by the board of directors of the
Corporation on the 25th day of April, 2002, and that such resolution
has not been modified or rescinded as of the date hereof.


 


                This 25th
day of March, 2004.


 


	
  BLUE RIDGE PAPER PRODUCTS INC.

  
	
   

  
	
   

  
	
  By:

  	
  /s/ JOHN S. STEVENS

  
	
  John S. Stevens, Assistant Secretary

  



 


 

















 


FOURTH AMENDMENT TO THE


 


RETIREMENT PLAN FOR SALARIED EMPLOYEES


OF BLUE RIDGE PAPER PRODUCTS INC.


 


The Retirement Plan for Salaried Employees of Blue Ridge Paper Products
Inc. is hereby amended by the Fourth Amendment:


 


1.                                       Section 7.5 of the Plan “General Rules”
is amended to reflect the final regulations under Section 401(a)(9) of the
Code by adding the following to the end of this Section to be effective
January 1, 2003:


 


h.                                      General Rules


 


1.                                       Effective Date. The effective date of these provisions for
purposes of determining required minimum distributions shall be for calendar
years beginning with the 2003 calendar year.


 


2.                                       Precedence. The requirements of this section will take precedence over any inconsistent
provisions of the Plan.


 


3.                                       Requirements of Treasury Regulations
Incorporated.  All distributions required under this
section will be determined and made in accordance with the Treasury
regulations under Section 401(a)(9) of the Code.


 


4.                                       TEFRA Section 242(b)(2) Elections. 
Notwithstanding the other provisions of this section, other than
subsection (h)(3), distributions may be made under a designation made
before January 1, 1984, in accordance with Section 242(b)(2) of the
Tax Equity and Fiscal Responsibility Act (TEFRA) and the provisions of the Plan
that relate to Section 242(b)(2) of TEFRA.


 


i.                                          Time and Manner of Distribution.


 


1.                                       Required Beginning Date. The Participant’s entire interest will be
distributed, or begin to be distributed, to the Participant no later than the
Participant’s required beginning date.


 


2.                                       Death of Participant Before Distributions
Begin. If the Participant
dies before distributions begin, the Participant’s entire interest will be
distributed, or begin to be distributed, no later than as follows:


 


A.                                   If the Participant’s surviving Spouse is the
Participant’s sole designated Beneficiary, distributions to the surviving


 

















 


Spouse will begin by December 31 of the calendar year immediately
following the calendar year in which the Participant died, or by
December 31 of the calendar year in which the Participant would have
attained age 70 1/2, if later.


 


B.                                     If the Participant’s surviving Spouse is not
the Participant’s sole designated Beneficiary, distributions to the designated
Beneficiary will begin by December 31 of the calendar year immediately
following the calendar year in which the Participant died.


 


C.                                     If there is no designated Beneficiary as of
September 30 of the year following the year of the Participant’s death,
the Participant’s entire interest will be distributed by December 31 of the calendar year
containing the fifth anniversary of the Participant’s death.


 


D.                                    If the Participant’s surviving Spouse is the
Participant’s sole designated Beneficiary and the surviving Spouse dies after
the Participant but before distributions to the surviving Spouse begin, this
subsection (i)(2), other than subsection (i)(2)(A), will apply as if
the surviving Spouse were the Participant.


 


For purposes of this subsection (i)(2) and subsection (1),
distributions are considered to begin on the Participant’s required beginning
date (or, if subsection (i)(2)(D) applies, the date distributions are
required to begin to the surviving Spouse under subsection (i)(2)(A)). If
annuity payments irrevocably commence to the Participant before the
Participant’s required beginning date (or to the Participant’s surviving Spouse
before the date distributions are required to begin to the surviving Spouse
under subsection (i)(2)(A)), the date distributions are considered to
begin is the date distributions actually commence.


 


3.                                       Form of Distribution. Unless the Participant’s interest is
distributed in the form of an annuity purchased from an insurance company or in
a single sum on or before the required beginning date, as of the first
distribution calendar year distributions will be made in accordance with
subsections (j), (k) and (1). If the Participant’s interest is distributed in
the form of an annuity purchased from an insurance company, distributions thereunder
will be made in accordance with the requirements of Section 401(a)(9) of
the Code and the Treasury regulations. Any part of the Participant’s interest
which is in the form of an individual account described in Section 414(k)
of the Code will be distributed


 

















 


in a manner satisfying the requirements of Section 401(a)(9) of
the Code and the Treasury regulations that apply to individual accounts.


 


j.                                          Determination of Amount to be Distributed
Each Year.


 


1.                                       General Annuity Requirements. If the Participant’s interest is paid in
the form of annuity distributions under the Plan, payments under the annuity
will satisfy the following requirements:


 


A.                                   the annuity distributions will be paid in
periodic payments made at intervals not longer than one year;


 


B.                                     the distribution period will be over a life
(or lives) or over a period certain not longer than the period described in
subsection (k) or (1);


 


C.                                     once payments have begun over a period
certain, the period certain will not be changed even if the period certain is
shorter than the maximum permitted;


 


D.                                    payments will either be nonincreasing or
increase only as follows:


 


i.                                          by an annual percentage increase that does
not exceed the annual percentage increase in a cost-of-living index that is
based on prices of all items and issued by the Bureau of Labor Statistics;


 


ii.                                       to the extent of the reduction in the amount
of the Participant’s payments to provide for a survivor benefit upon death, but
only if the Beneficiary whose life was being used to determine the distribution
period described in subsection (k) dies or is no longer the Participant’s
Beneficiary pursuant to a qualified domestic relations order within the meaning
of Section 414(p) of the Code;


 


iii.                                    to provide cash refunds of Employee
contributions upon the Participant’s death; or


 


iv.                                   to pay increased benefits that result from a
Plan amendment.


 


2.                                       Amount Required to be Distributed by Required
Beginning Date. The amount
that must be distributed on or before the Participant’s


 

















 


required beginning date (or, if the Participant dies before
distributions begin, the date distributions are required to begin under
subsection (i)(2)(A) or (B)) is the payment that is required for one
payment interval. The second payment need not be made until the end of the next
payment interval even if that payment interval ends in the next calendar year.
Payment intervals are the periods for which payments are received, e.g.,
bimonthly, monthly, semi-annually, or annually. All of the Participant’s
benefit accruals as of the last day of the first distribution calendar year
will be included in the calculation of the amount of the annuity payments for
payment intervals ending on or after the Participant’s required beginning date.


 


3.                                       Additional Accruals After First Distribution
Calendar Year. Any
additional benefits accruing to the Participant in a calendar year after the
first distribution calendar year will be distributed beginning with the first
payment interval ending in the calendar year immediately following the calendar
year in which such amount accrues.


 


k.                                       Requirements for Annuity Distributions that
Commence During Participant’s
Lifetime.


 


1.                                       Joint Life Annuities Where the Beneficiary is
not the Participant’s Spouse.
If the Participant’s interest is being distributed in the form of a joint and
survivor annuity for the joint lives of the Participant and a nonspouse
Beneficiary, annuity payments to be made on or after the Participant’s required
beginning date to the designated Beneficiary after the Participant’s death must
not at any time exceed the applicable percentage of the annuity payment for
such period that would have been payable to the Participant using the table set
forth in Q&A-2 of Section 1.401(a)(9)-6T of the Treasury regulations.  If the form of distribution combines a joint
and survivor annuity for the joint lives of the Participant and a nonspouse
Beneficiary and a period certain annuity, the requirement in the preceding
sentence will apply to annuity payments to be made to the designated
Beneficiary after the expiration of the period certain.


 


2.                                       Period Certain Annuities. 
Unless the Participant’s Spouse is the sole designated Beneficiary and
the form of distribution is a period certain and no life annuity, the period
certain for an annuity distribution commencing during the Participant’s
lifetime may not exceed the applicable distribution period for the Participant
under the Uniform Lifetime Table set forth in Section 1.401(a)(9)-9 of the
Treasury regulations for the calendar year that contains the


 

















 


Annuity Starting Date. If the Annuity Starting Date precedes the year
in which the Participant reaches age 70, the applicable distribution period for
the Participant is the distribution period for age 70 under the Uniform
Lifetime Table set forth in Section 1.401(a)(9)-9 of the Treasury
regulations plus the excess of 70 over the age of the Participant as of the
Participant’s birthday in the year that contains the Annuity Starting Date. If
the Participant’s Spouse is the Participant’s sole designated Beneficiary and the
form of distribution is a period certain and no life annuity, the period
certain may not exceed the longer of the Participant’s applicable distribution
period, as determined under this subsection (k)(2), or the joint life and
last survivor expectancy of the Participant and the Participant’s Spouse as
determined under the Joint and Last Survivor Table set forth in
Section 1.401(a)(9)-9 of the Treasury regulations, using the Participant’s
and Spouse’s attained ages as of the Participant’s and Spouse’s birthdays in
the calendar year that contains the Annuity Starting Date.


 


l.                                          Requirements For Minimum Distributions Where
Participant Dies Before Date Distributions Begin.


 


1.                                       Participant Survived by Designated
Beneficiary. If the
Participant dies before the date distribution of his or her interest begins and
there is a designated Beneficiary, the Participant’s entire interest will be
distributed, beginning no later than the time described
in subsection (i)(2)(A) or (B), over the life of the designated
Beneficiary or over a period certain not exceeding:


 


A.                                   unless the Annuity Starting Date is before
the first distribution calendar year, the life expectancy of the designated
Beneficiary determined using the Beneficiary’s age as of the Beneficiary’s
birthday in the calendar year immediately following the calendar year of the
Participant’s death; or


 


B.                                     if the Annuity Starting Date is before the
first distribution calendar year, the life expectancy of the designated
Beneficiary determined using the Beneficiary’s age as of the Beneficiary’s
birthday in the calendar year that contains the Annuity Starting Date.


 


2.                                       No Designated Beneficiary. If the Participant dies before the date
distributions begin and there is no designated Beneficiary as of
September 30 of the year following the year of the Participant’s death,
distribution of the Participant’s entire interest will be


 

















 


completed by December 31 of the calendar year containing the fifth
anniversary of the Participant’s death.


 


3.                                       Death of Surviving Spouse Before Distributions
to Surviving Spouse Begin.
If the Participant dies before the date distribution of his or her interest
begins, the Participant’s surviving Spouse is the Participant’s sole designated
Beneficiary, and the surviving Spouse dies before distributions to the
surviving Spouse begin, this subsection (1) will apply as if the surviving
Spouse were the Participant, except that the time by which distributions must
begin will be determined without regard to subsection (i)(2)(A).


 


m.                                        Definitions.


 


1.                                       Designated Beneficiary.  The
individual who is designated as the Beneficiary under Section 2.8 of the
Plan and is the designated Beneficiary under Section 401(a)(9) of the Code
and Section 1.401(a)(9)- Q&A-4, of the Treasury regulations.


 


2.                                       Distribution Calendar Year.  A
calendar year for which a minimum distribution is required.  For distributions beginning before the
Participant’s death, the first distribution calendar year is the calendar year
immediately preceding the calendar year which contains the Participant’s
required beginning date.  For
distributions beginning after the Participant’s death, the first distribution
calendar year is the calendar year in which distributions are required to begin
pursuant to subsection (i)(2).


 


3.                                       Life Expectancy.  Life
expectancy as computed by use of the Single Life Table in
Section 1.401(a)(9)-9 of the Treasury regulations.


 


4.                                       Required Beginning Date.  The
date specified in Section 7.5(e)(3)(A) of the Plan.


 


2.                                       Section 2.3 of the Plan “Actuarial
Equivalent” is amended by adding the following to the end of this
Section in order to bring the Plan into compliance with the 1994 Group
Annuity Reserving Table (94 GAR).


 


Notwithstanding any other Plan provisions to the contrary, for any
distribution with an Annuity Starting Date on or after December 31, 2002,
any references in the Plan to the Unisex 1983 Group Annuity Mortality Table
shall be replaced with the mortality table prescribed in Revenue Ruling
2001-62.


 

















 


3.                                       Article 10 of the Plan “Limitations on
Benefits” is amended by adding a new Section 10.6 in order to bring the
Plan into compliance with the 1994 Group Annuity Reserving Table (94 GAR).


 


10.6                           94 GAR. Notwithstanding any other Plan provisions to the contrary, for any
distribution with an Annuity Starting Date on or after December 31, 2002,
the applicable mortality table used for purposes of adjusting any benefit or
limitation under Section 415(b)(2)(B), (C), or (D) of the Code as set
forth in this Article 10 is the table prescribed in Revenue Ruling 2001-62.


 


4.                                       Sections 13.4 and 13.5 are deleted in their
entirety and restated, effective January 1, 2002 to read as follows:


 


13.4                           Initial Claims Procedure.


 


(a)                                  Claim.


 


(1)                                  Filing.  In order to present a
complaint regarding the nonpayment of a Plan benefit (either retirement or
disability benefit) or a portion thereof (a “Claim”), a Participant or
Beneficiary under the Plan (a “Claimant”) or his duly authorized representative
must file such Claim by mailing or delivering in person or by electronic media
(if so allowed by ERISA and approved by the Committee) a statement regarding
such Claim to: the Retirement Committee, Blue Ridge Paper Products Inc., One
West Pack Square, Suite 1100, Asheville, NC 28801.  A Claim includes a determination of whether specific employment
will be Section 203(a)(3)(B) service for purposes of the suspension of
benefits and also whether the Claimant is eligible for disability under the
Plan.  Throughout Section 13.4 and
Section 13.5, if there is a need to differentiate the term Claim between a
retirement claim or a disability claim, the terms will be referred to as
“Disability Claim” or “Retirement Claim” as is needed for clarity.


 


(2)                                  Acknowledgement.  Upon
such receipt of a Claim, the Committee shall furnish to the Claimant an
acknowledgement which shall inform such Claimant of the time limit set forth in
(b)(l) below and of the effect, pursuant to (b)(3) below, of failure to decide
the Claim within such time limit.


 

















 


(b)                                 Initial Decision.


 


(1)                                  Time Limit.  The Committee shall decide
upon a Claim within a reasonable period of time after receipt of such Claim;
provided however, that such period shall in no event exceed ninety (90) days
for a Retirement Claim or forty-five (45) days for a Disability Claim, unless
special circumstances require an extension of time for processing. If such an
extension of time for processing is required, then the Claimant shall, prior to
the termination of the initial ninety (90) day period for a Retirement Claim,
or forty-five (45) day period for a Disability Claim, be furnished a notice
indicating such special circumstances and the date by which the Committee
expects to render a decision.  In no
event shall an extension exceed a period of ninety (90) days for a Retirement
Claim, or for a Disability Claim, an initial extension of thirty (30) days and
a second extension of thirty (30) days from the end of the initial period.


 


(2)                                  Notice of Denial.  If
the Claim is wholly or partially denied, then the Committee shall furnish to
the Claimant, within the time limit applicable under (1) above, a notice
setting forth in a manner calculated to be understood by the Claimant:


 


(A)                              the specific reason or
reasons for such denial;


 


(B)                                specific reference to the pertinent Plan provisions on which such
denial is based;


 


(C)                                a description of any additional material or information necessary for
such Claimant to perfect his Claim and an explanation of why such material or
information is necessary; and


 


(D)                               appropriate information as to the steps to be taken if such Claimant
wishes to submit his Claim for review pursuant to Section 13.5, including
notice of the time limits set forth in Section 13.5(b)(2).


 


(E)                                 if the Claim is a Disability Claim the notice
must explain the standard on which entitlement to benefits is based and the
unresolved issues that prevent a positive decision regarding the Claim. The
Claimant must furnish to the Committee, within forty-five (45) days, any
additional information requested by the Committee. If additional information is
not furnished to the Committee


 

















 


within the forty-five (45) day period, the claim will be deemed denied
at expiration of such period.


 


(3)                                  Deemed Denial for Purposes of Review. If a Claim is not granted and if, despite
the provisions of (1) and (2) above, notice of the denial of a Claim is not
furnished within the time limit applicable under (1) above, then the Claimant
may deem such Claim denied and may request a review of such deemed denial
pursuant to the provisions of Section 13.5.


 


13.5                           Claim Review Procedure.


 


(a)                                  Claimant’s Rights.
If a Claim is wholly or partially denied under Section 13.4, then the
Claimant or his duly authorized representative shall have the following rights:


 


(1)                                  to obtain, subject to (b) below, a full and
fair review;


 


(2)                                  to review pertinent documents; and


 


(3)                                  to submit issues and comments.


 


(b)                                 Request for Review.


 


(1)                                  Filling.  To obtain a review pursuant to
(a) above, a Claimant entitled to such a review or his duly authorized
representative shall, subject to (2) below, mail or deliver or by electronic
media request such a review (a “Request for Review”) to: the Retirement
Committee, Blue Ridge Paper Products Inc., One West Pack Square, Suite 1100,
Asheville, NC 28801.  The Request for
Review may also be delivered by electronic media if so allowed by ERISA and
approved by the Committee.


 


(2)                                  Time Limits for Requesting a Review.  A
Request for Review must be mailed or delivered in person or by electronic media
if so allowed by ERISA and approved by the Committee within sixty (60) days for
a Retirement Claim after receipt by the Claimant of notice of the denial of the
Claim or within such longer period as is reasonable and related to the nature
of the benefit which is the subject of the Claim and to other attendant
circumstances. For a Disability Claim, the Claimant must request review of his
denied Claim within one hundred and eighty (180) days


 

















 


after receipt of notification of denial of the Claim or within one
hundred eighty (180) days after any deemed denial.


 


(3)                                  Acknowledgement. Upon such receipt of a Request for Review,
the Committee shall furnish to the Claimant an acknowledgement which shall
inform such Claimant of the time limit set forth in (c)(l) below and of the
effect, pursuant to (c)(3) below, of failure to furnish a decision on review
within such time limit.


 


(c)                                  Decision on Review. 


 


(1)                                  Time Limit.


 


(A)                              General.  If, pursuant to (b) above, a
review is requested, then, except as otherwise provided in (B) below, the
Committee (but only if such delegate has been given the authority to make a
final decision on the Claim) shall make a decision promptly and no later than
sixty (60) days after receipt of the Request for Review for a Retirement Claim,
or forty-five (45) days after Request for Review for a Disability Claim; except
that, if special circumstances require an extension of time for processing,
then the decision shall be made as soon as possible but not later than one
hundred twenty (120) days after receipt of the Request for Review for a
Retirement Claim, or ninety (90) days after Request for Review for a Disability
Claim.  The Committee must furnish the
Claimant notice of any extension prior to its commencement.


 


(B)                                Regularly Scheduled Meetings. 
Anything to the contrary with respect to Retirement Claims in (A) above
notwithstanding, if the decision on review is to be made by a committee which
holds regularly scheduled meetings at least quarterly, then its decision on
review shall be made no later than the date of the meeting which immediately
follows the receipt of the Request for Review; provided however, if such
Request for Review is received within thirty (30) days preceding the date of
such meeting, then such decision on review shall be made no later than the date
of the second meeting which follows such receipt; and provided further that, if
special circumstances require a further


 

















 


extension of time for processing, and if the Claimant is furnished
notice of such extension prior to its commencement, then such decision on
review shall be rendered no later than the third meeting which follows such
receipt.


 


(2)                                  Notice of Decision.  The
Committee shall furnish to the Claimant, within the time limit applicable under
(1) above, a notice setting forth in a manner calculated to be understood by
the Claimant:


 


(A)                              the specific reason or reasons for the
decision on review; and


 


(B)                                specific reference to the pertinent Plan
provisions on which the decision on review is based.


 


(C)                                for a Disability Claim, the notice shall also
include the specific guideline, protocol or other similar criterion used to
reach the decision, and a statement as follows: “You and your Plan may have
other voluntary alternative dispute resolutions options, such as
mediation.  One way to find out what may
be available is to contact your local U.S. Department of Labor Office and your
State insurance regulatory agency.”


 


(3)                                  Deemed Denial.  If,
despite the provisions of (1) and (2) above, the decision on review is not
furnished within the time limit applicable under (1) above, then the Claimant
shall be deemed to have exhausted his remedies under the Plan and he may deem
the Claim to have been denied on review.


 


5.                                       The Plan is amended by adding a new
Article 17 to reflect certain provisions of the Economic Growth and Tax
Relief Reconciliation Act of 2001 (“EGTRRA”).


 


ARTICLE 17


 


ECONOMIC GROWTH AND TAX
RELIEF RECONCILIATION ACT OF 2001


(“EGTRRA”)


 


Section 17.1 Amendment of the Plan for EGTRRA


 


a.                                       Adoption and Effective Date of Amendment. This amendment of the Plan is adopted to
reflect certain provisions of the Economic Growth and Tax


 

















 


Relief Reconciliation Act of 2001 (“EGTRRA”). This amendment is
intended as good faith compliance with the requirements of EGTRRA and is to be
construed in compliance with EGTRRA and guidance issued thereunder. Except as
otherwise provided, this amendment shall be effective as of the first day of
the first Plan Year beginning after December 31, 2001.


 


b.                                      Supersession of Inconsistent Provisions: This amendment shall supersede the
provisions of the Plan to the extent that those provisions are inconsistent
with the provisions of this
amendment.


 


Section 17.2 
Limitations on Benefits:


 


a.                                       Effect on Participants: Benefit increases resulting from the
increase in the limitations under Code Section 415(b) will be provided to
all current and former Participants (with benefits limited by Code
Section 415(b)) who have an Accrued Benefit in the Plan immediately prior
to the effective date of this Section (other than an Accrued Benefit
resulting from a benefit increase solely as a result of the increases in limitations
under Code Section 415(b).


 


b.                                      Definitions:


 


1.                                       Defined Benefit Dollar Limitation:  The
defined benefit dollar limitation is $160,000, as adjusted effective
January 1 of each year under Code Section 415(d) in such manner as
the Commissioner shall prescribe, and payable in the form of a straight life
annuity. The defined benefit dollar limitation as adjusted under Code
Section 415(d) will apply to Limitation Years ending with or within the
calendar year for which the adjustment applies.


 


2.                                       Maximum Permissible Benefit: The maximum permissible benefit is the
lesser of the defined benefit dollar limitation or defined benefit compensation
limit (both adjusted where required, as provided below).


 


A.                                   If a Participant has fewer than ten years of
participation in the Plan, the defined benefit dollar limitation shall be
multiplied by a fraction, the numerator of which is the number of years (or
part thereof) of participation, and the denominator of which is ten. If a
Participant has fewer than ten years of service, the defined benefit
compensation limitation shall be multiplied by a fraction, the numerator of
which is the number of years (or part thereof) of service, and the denominator
of which is ten.


 


B.                                     If a Participant’s benefit begins prior to
age sixty-two, the defined benefit dollar limitation applicable to the


 

















 


Participant at such earlier age is the annual benefit payable in the
form of a straight life annuity beginning at the earlier age that is the
actuarial equivalent of the defined benefit dollar limitation applicable to the
Participant at age sixty-two (adjusted under subsection (A) above, if
required). The defined benefit dollar limitation applicable at an age prior to
age sixty-two is determined as the lesser of (i) the actuarial equivalent (at such
age) of the defined benefit dollar limitation computed using the interest rate
and mortality table (or other tabular factor) specified in Section 2.3 of
the Plan and (ii) the actuarial equivalent (at such age) of the defined benefit
dollar limitation computed using a five percent interest rate and the
applicable mortality table as defined in 2.3 of the Plan. Any decrease in the
defined benefit dollar limitation determined in accordance with this
subsection (B) shall not reflect a mortality decrement if benefits are not
forfeited upon the death of the Participant. If any benefits are forfeited upon
death, the full mortality decrement is taken into account.


 


C.                                     If a Participant’s benefit begins after the
Participant attains age sixty-five, the defined benefit dollar limitation
applicable to the Participant at the later age is the annual benefit payable in
the form of a straight life annuity beginning at the later age that is
actuarially equivalent to the defined benefit dollar limitation applicable to
the Participant at age sixty-five (adjusted under subsection (A) above, if
required). The actuarial equivalent of the defined benefit dollar limitation
applicable at an age after age sixty-five is determined as the lesser of (i)
the actuarial equivalent (at such age) of the defined benefit dollar limitation
computed using the interest rate and mortality table (or other tabular factor)
specified in Section 2.3 of the Plan and (ii) the actuarial equivalent (at
such age) of the defined benefit dollar limitation computed using a five
percent interest rate assumption and the applicable mortality table as defined
in Section 2.3 of the Plan. For these purposes, mortality between age
sixty-five and the age at which benefits commence shall be ignored.


 


c.                                       Code Section 415 Aggregation Rules. A multiemployer plan shall not be combined
with a non-multiemployer plan for purposes of applying the Code
Section 415(b)(l)(B) compensation limit to the non-multiemployer plan.


 

















 


Section 17.3  Increase
in Compensation Limit:


 


a.                                       Increase in Limit: The annual compensation of each Participant
taken into account in determining benefit accruals in any Plan Year beginning
after December 31, 2001 shall not exceed $200,000.  Annual compensation means Compensation
during the Plan Year or other consecutive twelve-month period over which
compensation otherwise is determined under the Plan (the “determination
period”).  For purposes of determining
benefit accruals in Plan Years beginning after December 31, 2001,
Compensation for any prior determination period shall not exceed $200,000.


 


b.                                      Cost-of-living Adjustment:  The
$200,000 limit on annual compensation in the Section above shall be
adjusted for cost-of-living increases in accordance with Code
Section 401(a)(17)(B).  The cost-of-living
adjustment in effect for a calendar year applies to annual compensation for the
determination period that begins with or within such calendar year.


 


Section 17.4 
Modification of Top-Heavy Rules:


 


a.                                       Determination of Top-Heavy Status:


 


1.                                       Key Employee: “Key Employee” means any employee or former
employee (including any deceased employee) who at any time during that Plan
Year that includes the Determination Date was an officer of the Employer having
annual compensation greater than $130,000 (as adjusted under Code
Section 416(i)(l) for Plan Years beginning after December 31, 2002),
a five-percent owner of the Employer, or a one-percent owner of the Employer
having annual compensation of more than $150,000.  For this purpose, annual compensation means compensation within
the meaning of Code Section 415(c)(3). 
The determination of who is a Key Employee shall be made in accordance
with Code Section 416(i)(l) and applicable regulations and other guidance
of general applicability issued thereunder.


 


2.                                       Determination of Present Values and Amounts: This Section shall apply for purposes
of determining the present values of Accrued Benefits and the amounts of
account balances of employees as of the Determination Date.


 


3.                                       Distributions During Year Ending on the
Determination Date: The
present values of Accrued Benefits and the amounts of account balances of an
employee as of the Determination Date shall be increased by the distributions
made with respect to the employee under the Plan and any plan aggregated with
the Plan under Code Section 416(g)(2) during the one-year period ending on
the Determination Date.  The preceding
sentence also shall apply to


 

















 


distributions under a terminated plan that, had it not been terminated,
would have been aggregated with the Plan under Code
Section 416(g)(2)(A)(i). In the case of a distribution made for a reason
other than severance from employment, death, or disability, this provision
shall be applied by substituting “five-year period” for “one-year period.”


 


4.                                       Employees not Performing Services During Year
Ending on the Determination Date: The Accrued Benefits and account balances of any employee who has not
performed services for the Employer during the one-year period ending on the
Determination Date shall not be taken into account.


 


b.                                      Minimum Benefits: For purposes of satisfying the minimum
benefit requirements of Code Section 416(c)(l) and the Plan, in
determining Years of Service with the Employer, any service with the Employer
shall be disregarded to the extent that such service occurs during a Plan Year
when the Plan benefits (within the meaning of Code Section 410(b)) no Key
Employee or former Key Employee.


 


Section 17.5  Direct
Rollover of Plan Distributions:


 


a.                                       Modification of Definition of Eligible
Retirement Plan:  For purposes of the direct rollover
provisions of the Plan, an Eligible Retirement Plan shall also mean an annuity
contract described in Code Section 403(b) and an eligible plan under Code
Section 457(b) that is maintained by a  state,
political subdivision of a state, or any agency or instrumentality of a state
or political subdivision of a state and that agrees to separately account for
amounts transferred into such plan from this Plan.  The definition of Eligible Retirement Plan also shall apply in
the case of a distribution to a Surviving Spouse, or to a spouse or former
spouse who is the alternate payee under a Qualified Domestic Relations Order.


 


b.                                      After-Tax Employee Contributions:  For
purposes of the direct rollover provision in the Plan, a portion of a distribution
shall not fail to be an Eligible Rollover Distribution merely because the
portion consists of after-tax employee contributions that are not includible in
gross income. However, such portion may be paid only to an individual
retirement account or annuity described in Code Section 408(a) or
(b), or to a qualified defined contribution plan described in Code
Section 401(a) or 403(a) that agrees to separately account for amounts so
transferred, including separately accounting for the portion of such distribution
that is includible in gross income and the portion of such distribution that is
not so includible.


 

















 


IN WITNESS WHEREOF, the Corporation has caused this Fourth Amendment to
be signed and adopted this the 18th day of December, 2002.


 


	
   

  	
  BLUE
  RIDGE PAPER PRODUCTS INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ [ILLEGIBLE]